Conflicts of Interest or Commitment
We will avoid both actual conflicts of interest and the appearance of such conflicts, and devote our primary professional allegiance to the University and its mission of teaching, research, and public service-
This means that each member of the campus community to whom this standard applies
- Reports on financial interests as required by law
Perspective: A Real World Illustration
A January 2005 San Jose Mercury News newspaper article reported on the concerns of critics of California's stem cell research institute which focus on potential conflicts of interest among those running the program.
The financier who serves as chairman of the board that runs the institute reported that his company earned more than $6.6 million from real estate-related investments and businesses during 2004, according to an economic disclosure statement he filed.
And the vice chairman of the institute reported considerable holdings in several biotech companies, including Chiron, which he helped found in 1981 and where he still serves on the board of directors.
News of their wealth and investments created unease among critics of the program, who have pushed for more openness and tougher conflict-of-interest standards.
Much of the early stages of the program, created in November by Proposition 71, will focus on real estate, as the institute selects a site for its headquarters. The program is expected to generate many new lease agreements and construction projects, benefiting real estate developers, construction companies, bond counsel, insurers and similar businesses. The institute's headquarters will be rather modest, housing fewer than 50 employees and no lab space. But to do the type of science envisioned by the initiative, universities must build state-of-the-art research facilities.
The measure lets the institute's Independent Citizens Oversight Committee spend $300 million during the first five years on research facilities and up to $90 million on administration in 10 years.
As a member of the subcommittee seeking a site for the taxpayer-funded institute, the chairman will be in a position to influence decisions affecting commercial real estate in the chosen community. He also has temporary authority to hire staff and to rent short-term offices during the start-up phase of the program.
The chairman responded that his personal financial holdings pose no conflict of interest with his new role. He has pledged that he and his company do not hold biomedical stock or investments and that his real estate businesses will not apply for any institute grant, loan or contract or benefit from any lease or construction contract.
And the vice chairman has said his investments in biomedical fields are unrelated to stem cell research and that he will never invest in companies getting grants from the new institute.
Critics say that the chairman and vice chairman and others are offering a "trust us" argument that they don't buy.
"There are many indirect ways for [the chairman] to benefit from grants, through his interconnection with a wide variety of real estate interests. I don't think his assurances cover that full range of possibilities," said a public interest attorney.
All 29 members of the committee must file statements of economic interest to the Fair Political Practices Commission, the state watchdog agency set up 30 years ago to help prevent the abuse of public positions for private gain.
So far, only a few of the members are reporting holdings in biotech companies, some of which might one day benefit from the state's investment in biotechnology.
Last Revised 5/23/2006