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University Policy

Affiliated Entities (Affinity Principles)

Policy Number: 3349-03-190
Effective Date: 06/25/2014
Updated:
Reviewed:
Responsible Department: Office of the President, Office of the Vice, President for Administration and Finance, Office of the General Counsel
Applies To: All Affiliate Entities

Appendix A

Considerations for Creation of Affiliates

Policy Issues: “Will the Affiliate Serve the Best Interests of the University?”
  • Is the Affiliate formed to achieve a public purpose which is consistent with the mission of the University?
  • Does the Affiliate have a plan which has a reasonable probability of success? Have the appropriate internal constituencies been consulted (e.g., faculty, affected departments, etc.)?
  • Will the Affiliate’s activities conflict or complete with existing university activities
  • How will the Affiliate be received by external constituencies?
Financial Issues: “What are the Financial Implications of Establishing the Affiliate?”
  • Has a thorough and credible budget and/or business plan been prepared?
  • What level of financial support is expected to be provided by the University, does it serve a public purpose, the mission of the University and is it reasonable and appropriate?
  • What are the financial risks to the University and how are they addressed?
  • If the Affiliate will use University facilities or services, is proper reimbursement assured?
  • What is the proposed distribution of the Affiliate’s revenues and surplus?
  • What are the provisions for recovery of University investment?
Governance Issues: “Is the Appropriate Governance Structure Established?”
  • Who should represent the University on the Affiliate’s Board of Directors?
  • Are the proposed University Representatives for the Board of Directors qualified to oversee the mission and operations of the Affiliate?
  • Has responsibility for supervision of the activities of the Affiliate been clearly delegated to an official (e.g., vice president or dean) within the University?
  • Has a timeline been established for performance review and assessment?
  • Is the inclusion of reserve powers in the Affiliate’s governing documents appropriate?
Legal Issues: “Are there Adequate Safeguards to Avoid or Minimize Legal Risks and Financial Exposure?”
  • Is the Affiliate properly structured to maintain the appropriate degree of separation from the University?
  • If University employees will be involved with the Affiliate, have they complied with all University employment policies?
  • Is there a plan to manage real or potential conflicts of interest?
  • What are the risks of legal liability that may result from the activities of the Affiliate?
  • Are these risks adequately insured? What level of risk is the University prepared to accept?
  • Will the activities of the Affiliate give rise to questions regarding ownership of intellectual property?

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