Sample Policies of the Board
(CEO Evaluation, Confidentiality, Conflict of Interest)
CEO Evaluation Policy
1. At the beginning of the year, the CEO should outline
a set of measurable objectives that the Board can use to evaluate his/her
performance at the end of the year. These objectives should be approved
by the full Board.
2. The performance evaluation should be conducted by
the Executive Committee of the Board or by an ad hoc task force. (It
should not be done by the Chairman of the Board alone.)
3. The performance objectives should be translated into
a simple paper-pencil evaluation tool. The full Board should be asked
to complete all ratings on the evaluation tool and provide written comments
related to the CEO's performance.
4. The CEO should be asked to provide a written analysis
of his own performance, including use of the tool and providing any
background material s/he wishes to provide.
5. The Executive Committee should then meet to review
the results of the paper pencil survey and the CEO's assessment of his/her
own performance. There should be a full discussion of the CEO's accomplishments,
including a focused discussion of strengths and weaknesses. The conclusions
of this discussion should be summarized in writing including: an assessment
of accomplishments; a summary of strengths and weaknesses; an overall
satisfaction rating on a scale of 1-10; and at lest 2-3 development
goals for the coming year.
6. The CEO should receive a written summary of the evaluation
committee's assessment of his/her performance. The committee should
then meet with the CEO to discuss its conclusions. The committee should
remain open to the possibility of modifying its evaluation, based upon
this discussion. (The CEO may also wish to have a meeting with the Chairman
of the Board, prior to the meeting with the committee. However, under
no circumstance should the one-on-one meeting be a substitute for the
meeting with the Committee.)
7. Following the meeting with the CEO, the committee
may need to meet again to modify its written evaluation. The written
evaluation should then be presented to the full Board in an executive
session. Following discussion, the full Board should vote to accept
the formal evaluation.
8. The Board should have a formal compensation system
that ties the results of the evaluation into whatever salary increases
and/or bonuses the CEO receives as a result of his evaluation. All board
members should be fully informed regarding the salary level, salary
increases and bonuses received by the CEO.
9. The final step in the process should be the development
of the next year's performance objectives by the CEO and approval of
these objectives by the full Board.
10. The formal evaluation, the compensation increases,
and the performance objectives for the next year should all be approved
by a formal vote of the full Board.
11. This entire process should be absolutely confidential.
Confidentiality Policy
When the Board identifies select items of discussion
as confidential, all Board members are expected to keep such matters
confidential. This policy also applies to all printed material distributed
to board members that is marked "confidential".
Conflict-of-Interest Policy
As the organization continues to develop as a regional
integrated delivery system and as it enters into new forms of corporate
partnerships with physicians, the issue of conflict-of-interest becomes
increasingly more difficult to manage. It is especially true as it relates
to how physician leaders of entrepreneurial practices and physician
networks participate in the governance process. It is also true of lay
professionals (such as bankers, lawyers, accountants, and real estate
brokers) who do business with and provide advice and counsel to the
hospital, to physician entrepreneurs, and to major vendors who do business
with the hospital. Issues that my not have been perceived to be a conflict-of-interest
in the past, present significant conflicts of interest today, and many
of them are not handled well. Failure to maintain this conflict-of-interest
policy is grounds for removal from the Board.
Policy
1. It is not the intent to prevent any individual who
has a conflict-of-interest from serving on the Board. However, there
are times when a given conflict-of-interest in relationship to the mission
and strategic priorities of the Corporation is so significant that it
would be inappropriate for the individual to serve as a board member.
Such situations exist when it would be literally impossible to withhold
major proprietary information from the board member; and it would be
unlikely that the board member could successfully withhold it from his
or her client or not use it in his or her enterprise. When such situations
exist, the Board must address them.
2. On an annual basis, individual board members should
be requested to provide written identification of possible conflicts
of interest that may exist in relationship to their participation on
a board or board committee. Individual board members are responsible
for updating this list on an on-going basis.`
3. The Executive Committee will review the written list
for each board member at the beginning of each year.
a. If, in the mind of the Executive Committee, key relationships
that are perceived to be conflicts of interest are missing, a member
of the Executive Committee will talk with the individual to discuss
the situation. It is essential that all parties be in agreement related
to which relationships are and are not a conflict-of-interest. If there
is a disagreement between the Executive Committee and the individual
board member related to the existence of conflict-of-interest, the position
of the Executive Committee will prevail.
b. It is the Executive Committee's responsibility to
determine whether or not a board member's particular conflicts-of-interest
are so significant that s/he should not serve on Board or board committees.
If the Executive Committee arrives at this conclusion related to an
individual board member, it must make a formal recommendation to the
Board reflecting this perspective. It is then the Board's responsibility
to make a decision related to continuation of membership (i.e. - make
a recommendation to the County Council regarding terminating the individual's
membership on the Board).
4. No member of the Board, having a conflict-of-interest,
may use his or her personal influence on the matter and he/she shall
not be counted in determining the quorum for the meeting. Within such
a situation, the individual may briefly state his or her position on
the matter and answer pertinent questions. However, the conflict-of-interest
must first be revealed. For highly sensitive issues, it may be necessary
for the individual to leave the room during the discussion and vote,
due to the highly sensitive competitive nature of the situation.
5. If any board member believes that another board member
is violating the Corporation's conflict-of-interest policy, her or she
is responsible for sharing that viewpoint either directly with the individual
involved or with the Chairperson of the Board.
6. When a possible violation of the conflict-of-interest
policy has been identified by an individual board member, the Chair
of the Board must have a personal conversation with the individual perceived
to be in conflict-of-interest to discuss the situation.
7. Any member of the Board may request a formal review
of an individual's behavior related to conflict-of-interest. The Executive
Committee must conduct this review and render an opinion. When a difference
of opinion exists, a majority vote of the Executive Committee will prevail.
Examples Of Conflict-Of-Interest In The Current &
Future Healthcare Environment
- Physicians or others who own, joint venture, or provide business
support for major ambulatory care enterprises, physician offices,
development of physician practices aligned with competing systems,
managed care network (IPAs, MSO, etc.), specialty networks that are
either broader than or compete with the Corporation.
- Professionals who do a significant amount of business with a large
number of physician practices or a large physician practice that does
a significant amount of business with a System competitor.
- Individuals who sit on the Board of either for-profit or not-for-profit
organizations that are either competing with or exploring joint ventures
with the System.
- Physicians or others who own stock in Mary Black Memorial Hospital
(MBMH) and whose stock would increase in value if the financial performance
of MBMH were to improve.
- Individuals who are business partners, blood relatives, or very
close friends with individuals who have the types of conflict-of-interest
identified above.
Content Provided by
The Bristol Group
