Corporate Financial Support at Queen's: A Policy Framework for a Productive Partnership

January 10, 2003

Kathy Arney

Donna Janiec

Donna Lounsbury (Chair)

Elaine McDougall

Georgina Moore

Marlene Rego

Background
Work of the Subcommittee
Principal Areas of Corporate Involvement at ��ֱ��

I. Background

The Rosenberg Committee on Corporate Involvement submitted their final report to Suzanne Fortier, Vice-Principal (Academic), in February, 2002. The Committee saw its mandate as undertaking a comprehensive review of corporate involvement at the university, then "identifying the most appropriate persons and bodies who would need to take responsibility for the development of policies in their particular area." Given the complexity of the task at hand, the Committee did not undertake to develop policies in every area where corporate involvement exists.

The Rosenberg Report was reviewed by the Principal and Vice-Principals in April who commented positively on the comprehensive overview that the report provided on corporate involvement at ��ֱ��. Knowing that the report would provide a strong foundation for further work in this area, a decision was taken by the Principal and Vice-Principals to extend the work of the initial Committee to more fully develop a policy framework with respect to corporate support at ��ֱ��.

This decision was taken in view of the increasing importance of corporate support to the university - through philanthropy, research funding, and commercial activity and sponsorship. These revenues to ��ֱ�� provide tangible and significant benefits to the learning environment and to the academic work of faculty and students. While there is significant potential in the future to increase this level of corporate support, there is also a need to ensure that all such support is consistent with the university's fundamental values and academic mission. Policy in this area must therefore provide flexibility to the university in seeking corporate support, recognize the potential benefits of this support, and also delineate conditions and restrictions which may apply.

The Principal struck a small subcommittee in May 2002 consisting of the Director of the Principal's Office (Chair), the Secretary of the University, and the Executive Assistants to the Vice-Principals. The subcommittee was tasked with reviewing major areas of corporate support at ��ֱ��, identifying gaps in current practice and recommending appropriate policies to define and clarify the university's relationship with the corporate sector for the future. The subcommittee was asked to produce a draft report in the Fall, 2002, then a final report for consideration by the University Council at its May, 2003 meeting.

II. Work of the Subcommittee:

The subcommittee completed its work in November, 2002 after seven full meetings and numerous individual meetings to explore all aspects of corporate support at ��ֱ��. In keeping with the recommendations of the Rosenberg report, the main areas considered were the following:

philanthropy;
commercial activity, sponsorship and advertising on campus;
financial practices and policies
administrative/academic policies
research and graduate students;
relationships with groups such as PARTEQ, QCED and related companies;
corporate involvement in investments.

Specifically, the sub-committee undertook to do the following:

Review major areas of corporate interaction with the university, using the Rosenberg Committee Report as background.
Develop/amend policies where necessary to ensure that corporate interaction in all respects is appropriate and beneficial to the university. In particular, this means:
1. that it is transparent;
2. that it is consistent with the university's fundamental character as a place of academic freedom, intellectual inquiry and integrity;
3. that it adds value to the learning and research environment.
Develop a set of specific recommendations to ensure responsible oversight of corporate involvement, to clarify roles and responsibilities and to ensure sound and workable process and practice.

In addition to the work of the Rosenberg Committee, the sub-committee acknowledges the extensive work of the Alumni Association Ad Hoc Task Force on Corporate Sponsorship (Jeff Chan, Chair; report submitted to Alumni Assembly, May, 2002) and the AMS Government Issues Committee (Corporate Involvement at ��ֱ��: Checks and Balances for the New Millennium, April, 2000). These documents have been a valuable source of information for the sub-committee.

III. Principal Areas of Corporate Involvement at ��ֱ��:

1. Philanthropy:

The principal policies which guide the university's conduct in the area of corporate philanthropy are the Gift Acceptance Policy , the Naming Policy , and Control and Use of the Charitable Registration Number (PDF*, 70 KB). While there are numerous other policies in the Advancement/ philanthropy area, these three policies define the conditions under which the university will accept a gift, provide recognition for a gift, and ensure that the process followed is fair, transparent and consistent with the interests of the university.

The Rosenberg report noted that both the Gift Acceptance Policy and the Naming Policy needed review and updating. The subcommittee has undertaken this process through the Office of Advancement and the University Secretariat to both improve the process of gift acceptance and naming, and to ensure that the university's interests and academic integrity are protected. The revised policies will be taken to the December meeting of the Advancement Committee and the Board of Trustees for final approval.

The Control and Use of the Charitable Number is a more recent policy approved in November 2001 by the Board of Trustees. The policy ensures that proper process is followed by ��ֱ�� as a registered charity, and by several other groups affiliated with ��ֱ�� (such as the Ban Righ Foundation) which have their own charitable registration numbers.

The sub-committee noted as well that there was a need for a statement of ethical conduct to be embedded in the above policies, and in other policies and agreements which define our relationship with commercial enterprises and external organizations. As such, a statement has been developed which incorporates the university's essential values endorsed by Senate (Principles and Priorities Report, January, 1996).

Philanthropy: Recommendations and Actions Taken:

That the Gift Acceptance Policy and Naming Policy be amended as indicated above. Responsibility: Secretariat/Advancement. Action Taken: Revised policies have now been completed, and approved by the Board of Trustees (December 7, 2002). Next Steps: None. (Appendix 1)
That a draft Statement of Ethical Conduct be developed for inclusion in policies in this area and in agreements with commercial enterprises and external organizations. Responsibility: Sub-Committee. Action Taken: Statement drafted and approved by Principal and Vice-Principals. Next Steps: None. (Appendix 2)

The Committee is satisfied that with the actions noted above, the university will have a strong set of checks and balances to ensure the highest possible standard of conduct in the area of corporate philanthropy.

2. Commercial Activity, Advertising, and Corporate Sponsorship

This is a large area of activity, covering direct corporate advertising on campus, sponsorship of events, projects and programs, and commercial activity aimed at students, faculty, alumni and employees.

The sub-committee found that few current policies exist which guide the university's behaviour in this area, other than the Campus Alcohol Policy, the and the John Deutsch University Centre Commercial Activity Policy (Appendix 7 - Supplementary Materials). These policies are limited in scope and do not provide an overall mechanism or structure for reviewing and approving the various forms of commercial activity on campus.

The sub-committee spent considerable time reviewing guidelines and policies of other universities, including the University of Toronto, Western, UBC and a number of American universities. Having carefully looked at a number of approaches to advertising and commercial activity, the committee has concluded that ��ֱ�� should adopt a policy which recognizes the importance of attracting non-philanthropic revenues to support the academic mission of the university. It is the sub-committee's view that commercial enterprise on campus can provide real and significant benefits to the university and to its learning environment, but it must be judged to be consistent with the core values of the university and its academic objectives. Any new policy that is developed must therefore balance the need to protect the university against inappropriate corporate support, and the need to be fair-minded and reasonable in assessing the value/benefits that this support may bring.

In the related area of "Trademarks and Licensing", the committee has reviewed the current organization whereby the function falls to the Office of the Dean of Student Affairs for oversight, and has concluded that this arrangement works very well. The sub-committee has reviewed licensee contracts which are agreements between the university and its licensees. With the assistance of the university legal counsel, licensee agreements have now been modified to include a code of conduct for all licensees, and the committee is satisfied that this contract makes the university's expectations clear with respect to socially responsible business practices.

Commercial Activity/Sponsorship - Recommendation and Actions Taken:

That a policy be developed which outlines an overall process of approval for commercial requests, and outlines as well guiding principles in examining these issues. All commercial contracts and agreements, whether sponsorship, advertising or general commercial activity, would conform to this new policy. The policy would make explicit the university's commitment not to engage in any business activity which compromises its essential values or its public image. Responsibility: Office of Vice-Principal(Advancement) and Office of the Vice-Principal (Academic). Action Taken: Some research has been conducted on the practices of other universities in this area. A policy framework and a set of guiding principles have been developed by the sub-committee (Appendix Three). Further consultation and work needs to be done to develop a comprehensive commercial activity/sponsorship policy. Next Steps: Vice-Principal (Academic) and VP(Advancement) or delegates will develop and finalize a policy prior to June 1, 2003. Then approval by Principal and Vice-Principals.
That licensee agreements be modified to include a code of conduct clause. Responsibility: University Legal Counsel with Office of Dean of Student Affairs. Action Taken: Completed. Next Steps: None. (Appendix Three)

3. Financial Practices and Policies (including Purchasing Policy, Bank Accounts Policy, Travel and Subsistence, Contract Approval Process):

The committee has reviewed all of the relevant policies related to financial and administrative practices at the university. The objective in doing this is to ensure that policies are rigorous enough to ensure arms-length relationships with suppliers and external organizations, proper accountability and scrutiny of financial transactions, and appropriate checks and balances in all matters that may have financial implications for the university. In some cases, the sub-committee has identified a need for amendment or more rigorous wording of a policy document. Where appropriate, we have consulted with the relevant directors (Finance, Purchasing, Audit, etc) and have sought legal advice as required.

The sub-committee also agrees with the Rosenberg report recommendation that a written contract approval process be developed at ��ֱ�� to clarify responsibilities and process for the signing of contracts with outside groups and organizations.

Financial Practices - Recommendations and Actions Taken:

That the Bank Accounts Policy be amended. Responsibility: VP(Ops & Finance) in consultation with University Legal Counsel and Financial Services. Action Taken: Completed. Next Steps: None required. (Appendix Four).
That a written contract approval process be developed. Responsibility: University Secretary, Legal Counsel and Internal Auditor. Action Taken: Close to completion. Next steps: University Secretary to bring to closure by March 31, 2003.
That the Affiliate Organizations list be reviewed and updated. That an updated copy of the list be kept on file in Human Resources. Responsibility: VP(Ops & Finance) in conjunction with Human Resources and University Legal Counsel. Action Taken: Completed. Next Steps: Human Resources to update list on an annual basis. (Appendix Four).

The committee is satisfied that, with these new measures in place, a strong set of policies will exist to ensure a high level of financial accountability and scrutiny.

4. Administrative and Academic Policies

The sub-committee noted that there is no central web-site of policies for the university. Currently policies that have been approved by the Board of Trustees or Senate are listed on the policy site of the University Secretariat. Other policies related to Human Resources, Health and Safety, Finance, Security, etc. are listed on the relevant department's web-site. This current system makes it difficult in some cases to find policies and to ensure that policies are up to date and relevant in the current environment. A centralized web-site would ensure greater transparency of the checks and balances that exist at ��ֱ�� and greater accountability for those who are asked to manage the policy.

Administrative/Academic Policies - Recommendation and Action Taken:

That a centralized web-site be developed which will include all policies of the university, and dates when these were approved. This will apply not only to Board and Senate policies, but other administrative policies as well (Financial, Human Resources, Health and Safety, Security, etc.). Responsibility: University Secretariat. Actions Taken: none. Next steps: To be completed by Summer, 2003.

5. Corporate Involvement with Graduate Students and in Research

The Rosenberg Committee concluded that, despite a long list of policies related to the administration of research funds, intellectual property, and research ethics, there still remain significant gaps in the university's ability to provide strong oversight of corporate support of research. The major gaps identified by the Rosenberg committee in consultation with Research Services were the following:

Need for "certification/disclosure" forms for corporate involvement in research activities.
Need to more clearly define roles and responsibilities of decision-makers around declarations of conflict of interest.
Need to more clearly define guidelines regarding conflict of commitment.
Need to more clearly describe significant external professional commitment as noted in the Collective Agreement.
Need for clearer communication of terms of research contracts to all participants
Need for a clear statement of ethical conduct of sponsors
Better communication with graduate students regarding corporate funding of research assistantships.

The sub-committee sought the advice and assistance of the Director of Research Services in addressing these concerns. The Director was able to provide a written brief to the sub- committee advising generally how these concerns might be addressed, and also providing specific recommendations for actions that could be implemented in the short term. With the new Collective Agreement ratified in May, 2002 and the implementation of new articles with respect to conflict of commitment and conflict of interest, the Director of Research Services has assured the committee that two of these gaps has now been fully closed ((c) and (d) above re conflict of commitment) and another gap has been partially addressed ( (b) above - conflict of interest). Other recommendations and actions to be taken are outlined below:

Research and Graduate Students - Recommendations and Actions Taken:

That better communication ((e) and (g) above) needs to take place with all participants in research agreements, including graduate and professional students. The committee recommends that this be handled through the existing handbook for graduate and professional students, and by implementing participant agreements on all contracts. Responsibility: School of Graduate Studies and Office of Research Services. Actions Taken: Participant Agreements have now been implemented by Research Services ( Appendix 5 ) Next Steps: By March 1^st, 2003, the School of Graduate Studies (through the Dean) will inform students/supervisors of their obligations with respect to research activities and graduate supervision as outlined in the Graduate handbook (Appendix 5). The Dean of Graduate Studies will ensure that these guidelines are clearly communicated to these parties each year. The School of Graduate Studies will also inform graduate students by March 1^st, 2003, of their obligation to complete participant agreements for research projects they are involved with.
That a clear statement of ethical conduct (Appendix 2) be included in each research contract so that external sponsors of research are held to the same ethical standards that the university upholds ( (f) above). The statement as noted defines the university's essential values and makes it explicit that the university will not accept external support that compromises these values or the university's commitment to its academic mission. Responsibility: Sub-committee to develop statement; Director of Research Services to implement. Action Taken: Statement has been developed, and approved by Principal and Vice-Principals. Next Steps: Director of Research Services will ensure that the statement is included in research agreements, effective March 1^st, 2003.
The remaining gaps (a and b above) relate to disclosures of conflict of interest. The new provisions of the Collective Agreement provide an excellent framework for conflict of interest situations. Guidelines, however, need to be developed to operationalize the intent of these articles as they pertain to research. Examples need to be developed on what would constitute a conflict of interest and what form the disclosure should take. Responsibility: Director of Research Services in close cooperation with Associate Vice-Principal (Faculty Relations). Actions Taken: Recommendation has been approved by Principal and Vice-Principals. Next Steps: Director of Research Services, in consultation with the Associate Vice-Principal (Faculty Relations) will develop operational guidelines for ��ֱ�� (Note: In developing examples, the sub-committee recommends that they refer to the Harvard Medical School guidelines for conflict of interest - Appendix 5).

6. Incorporated Affiliates at ��ֱ�� -- PARTEQ, QCED, etc.

These incorporated entities have independent boards of directors, and they report as well to the ��ֱ�� Board of Trustees. In each case, ��ֱ�� administration is also represented on their separate boards. The Vice-Principal (Research), for example, chairs the PARTEQ Board, and two members of the ��ֱ�� Board of Trustees and the Dean of the School of Business sit on the QCED Board. So there appears to be a reasonable, and we believe appropriate, level of scrutiny to all of their activities. This being said, the sub-committee believes it would be appropriate for these organizations to explicitly recognize within their constitutions or memoranda of understanding that, in all aspects of their operations, they adhere to the same set of standards as the university.

Incorporated Affiliates at ��ֱ�� - Recommendations and Actions:

That incorporated affiliates of ��ֱ�� (such as PARTEQ and QCED) adhere to the same standard of ethical conduct expected of the university (Appendix 2). That a statement to this effect be included in their constitutions or memorandum of understanding. Responsibility: VP (Research) (PARTEQ) and VP (Operations and Finance) (QCED). Action Taken: Recommendation approved by Principal and Vice-Principals. Next Steps: Amendment to constitutions/MOU by April 30th, 2003.
That the process for creating incorporated entities at ��ֱ�� be documented and presented to the Principal and Vice-Principals for approval. Responsibility: Vice-Principal (Operations and Finance). Actions Taken: None to date. Next Steps: Documentation as indicated by VP(Operations and Finance) then approval by Principal and Vice-Principals.

7. Corporate Involvement in Investments:

From time to time within the university community, concerns are raised about where and how ��ֱ�� invests funds from its endowment and from the Pension Plan. The endowments of the university are the purview of the Investment Committee and the Pension Plan is managed under the oversight of the Pension Committee, both standing committees of the Board of Trustees. As well, the committees are guided by specific "Statements of Objectives, Policies and Procedures", which are reviewed annually (Appendix 6). Any substantial changes to the mandate or responsibilities of these committees requires Board approval. We believe that the current governance structure and procedures are appropriate and that they ensure a sufficient level of oversight and scrutiny by the Board of Trustees.

Investments - Recommendations and Actions:

That the current governance structure and set of procedures for managing and overseeing the university's investments be maintained. That when substantial issues and concerns arise which cannot be dealt with at the committee level, they be taken to the Board of Trustees for consideration. Responsibility: Board of Trustees. Actions Taken: None required. Next Steps: None required.

In summary, the sub-committee has reviewed the seven areas of corporate involvement outlined above, and is pleased to present this set of recommendations for consideration by the Principal and Vice-Principals. The full set of recommendation (14 in all) and actions to be taken are summarized in the attached table (Table 1).

Recommendation	Area of Corporate Support	Responsibility	Action Taken	Next Steps
1. That the Gift Acceptance and Naming Policies be amended.	Philanthropy	Secretariat/ Advancement	Revised policies have now been approved by Board of Trustees (Dec. 7/02)	None required
2. That a Statement of Ethical Conduct be developed for inclusion in policies and in agreements with commercial enterprises and external organizations.	General	Sub-Committee	Statement drafted and approved by Principal and Vice-Principals	None required
3. That a policy be developed which outlines an overall process of approval for commercial requests, and outlines as well guiding principles in examining these issues.	Commercial Activity/Sponsorship	Office of Vice-Principal (Advancement) and Office of Vice-Principal (Academic)	Some research has been conducted on the practices of other universities in this area. A framework and set of guiding principles have been developed for a new policy document.	VP (Academic) and VP(Advancement) or delegates will develop and finalize a policy prior to June 1, 2003. Then approval of Principal and VPs.
4. That licensee agreements be modified to include a code of conduct clause.	Commercial Activity/Sponsorship	University Legal Counsel with Office of Dean of Student Affairs	Completed	None required
5. That the Bank Accounts Policy be amended.	Financial Practices	VP(Ops & Fin) in consultation with University Legal Counsel and Financial Services.	Completed	None required
6. That a written contract approval process be developed.	Financial Practices	University Secretariat, Legal Counsel and Internal Auditor	Close to completion	University Secretary to bring to closure by March 31, 2003.
7. That the Affiliate Organizations list be reviewed and updated. That an updated copy of the list be kept on file in Human Resources.	Financial Practices	VP(Ops & Fin) in conjunction with Human Resources and University Solicitor	Completed	Human Resources to update list on an annual basis.
8. That a centralized website be developed including all policies of the university and dates when these were approved	Administrative/ Academic Policies	University Secretariat	None	To be completed by Summer, 2003.
9. That better communication take place with all participants in research agreements, including graduate and professional students.	Research and Graduate Students	School of Graduate Studies and Office of Research Services	Participant Agreements have now been implemented by Research Services	By March 1, 2003, the Dean of the School of Graduate Studies will inform students/supervisors of their obligations with respect to research activities and graduate supervision as outlined in the Graduate handbook. These guidelines will be clearly communicated annually. The Dean will also inform graduate students by March 1, 2003 of their obligation to complete participant agreements for research projects.
10. That a clear statement of ethical conduct be included in each research contract.	Research and Graduate Students	Director of Research Services	Statement has been developed, and approved by Principal and Vice-Prinicpals.	Director of Research Services will ensure that the statement is included in research agreements, effective March 1, 2003.
11. The remaining gaps relate to disclosures of conflict of interest. Guidelines need to be developed to operationalize the intent of articles within the Collective Agreement as they pertain to research.	Research and Graduate Students	Director of Research Services in close cooperation with Assoc. VP(Faculty Relations)	Recommendation approved by Principal and Vice-Principals	Director of Research Services with Assoc. VP(Faculty Relations) will develop operational guidelines for ��ֱ��.
12. That incorporated affiliates of ��ֱ�� adhere to the same standard of ethical conduct expected of the university. That a statement to this effect be included in their constitutions or memorandum of understanding	Incorporated Affiliates	VP(Research) (PARTEQ) and VP(Operations & Finance)(QCED)	Recommendation approved by Principal and Vice-Principals	Amendment to constitutions/MOU by April 30, 2003
13. That the process for creating incorporated entities at ��ֱ�� be documented and presented to the Principal and Vice-Principals for approvals	Incorporated Affiliates	VP(Ops & Fin)	None to date.	Documentation as indicated by VP(Operations and Finance) then approval by Principal and Vice-Principals.
14. That the current governance structure and set of procedures for managing and overseeing the university's investments be maintained. That when substantial issues and concerns arise which can't be dealt with at the committee level, they be taken to the B of T for consideration.	Investments	Board of Trustees	None required	None required.

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