Conflicts of Interest Policy

ARTICLE I: PURPOSE

The purpose of this Conflicts of Interest Policy is to protect the interests of The Open Accounts Receivable Collective Foundation (the “Foundation”) when it is contemplating entering into a transaction or arrangement that might benefit the private interests of a director, officer, or key employee, or that might otherwise constitute a conflict of interest. This policy is intended to supplement, but not replace, any applicable state or federal laws governing conflicts of interest for nonprofit and charitable organizations.

ARTICLE II: DEFINITIONS

Section 2.1. Interested Person

Any director, officer, key employee, or member of a committee with Board-delegated powers who has a direct or indirect financial interest, as defined in Section 2.2, or an indirect commercial benefit, as defined in Section 2.4, is an “Interested Person.”

Section 2.2. Financial Interest

A person has a “financial interest” if the person has, directly or indirectly, through business, investment, or family:

• An ownership or investment interest in any entity with which the Foundation has a transaction or arrangement

• A compensation arrangement with the Foundation or with any entity or individual with which the Foundation has a transaction or arrangement

• A potential ownership or investment interest in, or compensation arrangement with, any entity or individual with which the Foundation is negotiating a transaction or arrangement

• An ownership or employment interest in a business that derives revenue from implementing, supporting, or commercializing Foundation software, tools, or programs for third-party clients, where Foundation governance decisions directly affect the commercial value of that business activity.

Compensation includes direct and indirect remuneration as well as gifts or favors that are not insubstantial. For purposes of this policy, “family” has the meaning given to “family member” in Section 3.1 of the Anti-Nepotism Policy. A financial interest is not necessarily a conflict of interest. A conflict of interest exists only if the Board or committee determines that a conflict of interest exists under Section 3.2.

Section 2.3. Conflict of Interest

A “conflict of interest” exists when an Interested Person’s financial interest, indirect commercial benefit, personal relationship, or other loyalty may compromise, or appear to compromise, the independent exercise of that person’s judgment on behalf of the Foundation.

Section 2.4. Indirect Commercial Benefit

A director has an “indirect commercial benefit” if the director, or a business in which the director has an ownership or employment interest, derives revenue from activities whose commercial value is directly shaped by Foundation decisions. Indirect commercial benefit includes, without limitation:

• Providing implementation, integration, or technical consulting services related to Foundation software or programs to third-party clients, for a fee

• Providing ongoing support, training, or managed services for Foundation software to third-party clients, for a fee

• Operating a business whose competitive position depends materially on Foundation technology choices, licensing terms, API design, or release cadence

• Acting as a reseller, distributor, or value-added provider of Foundation software or Foundation-certified services.

An indirect commercial benefit constitutes a financial interest for purposes of this policy and triggers the disclosure obligations described in Article III. A director with an indirect commercial benefit will disclose it annually and will recuse from any Board or committee vote that confers a benefit particular to the director or the director’s business, as described in Section 2.5. Decisions that affect all implementers, users, or community members as a class do not, by themselves, require recusal; such decisions are governed by disclosure and the procedures in Sections 3.2 and 3.3.

Section 2.5. Affected Decision

An “affected decision” is any Board or committee decision that could reasonably be expected to provide a material financial benefit to an Interested Person beyond the benefit provided to the Foundation’s general community of users and contributors. For a director with an indirect commercial benefit, affected decisions include votes on a certification or endorsement application by the director’s business, selection of the director’s business as a vendor or contractor, partner program terms under which the director’s business is a pending applicant, and any other decision in which the director’s business stands to gain in a manner particular to it rather than shared with the general class of implementers, users, or community members.

ARTICLE III: PROCEDURES

Section 3.1. Duty to Disclose

In connection with any actual or possible conflict of interest, an Interested Person will disclose the existence of the financial interest or indirect commercial benefit and all material facts to the Board of Directors or the committee with Board-delegated powers considering the proposed transaction or arrangement. Disclosure will be made as soon as the Interested Person becomes aware of the actual or potential conflict, and in all cases before any vote or decision is made on the matter. Ongoing indirect commercial benefits will be disclosed in the annual disclosure statement under Article VIII and updated promptly when material circumstances change.

Section 3.2. Determining Whether a Conflict Exists

After disclosure of the financial interest or indirect commercial benefit and all material facts, and after any discussion with the Interested Person, the Interested Person will leave the Board or committee meeting while the determination of whether a conflict of interest exists is discussed and voted on. The remaining Board or committee members will decide if a conflict of interest exists.

Section 3.3. Procedures for Addressing Conflicts

An Interested Person may make a presentation at the Board or committee meeting, but after the presentation, will leave the meeting during the discussion of, and the vote on, the transaction or arrangement involving the possible conflict of interest.

The Chair of the Board or committee will, if appropriate, appoint a disinterested person or committee to investigate alternatives to the proposed transaction or arrangement.

After exercising due diligence, the Board or committee will determine whether the Foundation can obtain with reasonable efforts a more advantageous transaction or arrangement from a person or entity that would not give rise to a conflict of interest.

If a more advantageous transaction or arrangement is not reasonably possible under circumstances not producing a conflict of interest, the Board or committee will determine by a majority vote of the disinterested directors whether the transaction or arrangement is in the Foundation’s best interest, for its own benefit, and whether it is fair and reasonable. In conformity with the above determination, it will make its decision as to whether to enter into the transaction or arrangement.

Section 3.4. Recusal from Affected Decisions

A director with a disclosed indirect commercial benefit will recuse from deliberation and voting on all affected decisions, as defined in Section 2.5, regardless of whether the full conflict of interest procedure in Sections 3.2 and 3.3 has been invoked. The recusal and its basis will be noted in the meeting minutes. A recusing director may remain in the meeting room during the deliberation only if a majority of the disinterested directors present affirmatively vote to permit the director to remain.

Section 3.5. Violations of the Conflicts of Interest Policy

If the Board or committee has reasonable cause to believe a member has failed to disclose an actual or possible conflict of interest or indirect commercial benefit, it will inform the member of the basis for such belief and afford the member an opportunity to explain the alleged failure to disclose.

If, after hearing the member’s response and after making further investigation as warranted by the circumstances, the Board or committee determines the member has failed to disclose an actual or possible conflict of interest, it will take appropriate disciplinary and corrective action.

ARTICLE IV: RECORDS OF PROCEEDINGS

The minutes of the Board and all committees with Board-delegated powers will contain:

• The names of the persons who disclosed or otherwise were found to have a financial interest or indirect commercial benefit in connection with an actual or possible conflict of interest

• The nature of the financial interest or indirect commercial benefit

• Any action taken to determine whether a conflict of interest was present

• The names of any directors who recused from deliberation or voting, and the basis for each recusal

• The Board’s or committee’s decision as to whether a conflict of interest in fact existed.

The minutes will also contain the names of the persons who were present for discussions and votes relating to the transaction or arrangement, the content of the discussion, including any alternatives to the proposed transaction or arrangement, and a record of any votes taken in connection with the proceedings.

ARTICLE V: ANNUAL STATEMENTS

Each director, officer, and member of a committee with Board-delegated powers will annually sign a statement that:

• Affirms that such person has received a copy of the Conflicts of Interest Policy

• Affirms that such person has read and understands the policy

• Affirms that such person has agreed to comply with the policy

• Affirms that such person understands the Foundation is a charitable organization and that in order to maintain its federal tax exemption it must engage primarily in activities that accomplish one or more of its tax-exempt purposes.

The Secretary will maintain records of all signed annual statements.

ARTICLE VI: PERIODIC REVIEWS

To ensure the Foundation operates in a manner consistent with its charitable purposes and does not engage in activities that could jeopardize its tax-exempt status, periodic reviews will be conducted. The periodic reviews will, at a minimum, include the following subjects:

• Whether compensation arrangements and benefits are reasonable, based on competent survey information, and the result of arm’s-length bargaining

• Whether partnership and joint venture arrangements and arrangements with management companies conform to the Foundation’s written policies, are properly recorded, reflect reasonable investment or payments for goods and services, further charitable purposes, and do not result in inurement, impermissible private benefit, or in an excess benefit transaction

• Whether any director’s indirect commercial benefit has grown in scope or materiality since the prior year’s review, and whether existing recusal practices remain sufficient.

ARTICLE VII: USE OF OUTSIDE EXPERTS

When conducting the periodic reviews as provided for in Article VI, the Foundation may, but need not, use outside advisors. If outside experts are used, their use will not relieve the Board of its responsibility for ensuring that periodic reviews are conducted.

ARTICLE VIII: ANNUAL DISCLOSURE STATEMENT

Each director, officer, and committee member will complete and sign an Annual Conflicts of Interest and Nepotism Disclosure Statement, in the form approved by the Board of Directors, upon beginning service and annually thereafter.

The statement will disclose direct financial interests, indirect commercial benefits, any other relationship or circumstance that may give rise to an actual or potential conflict of interest under this policy, and any family member or person with a close personal relationship covered by the Anti-Nepotism Policy who serves the Foundation or serves on the Board of Directors.

Completed statements are delivered to the Secretary, who retains them in the permanent records of the Foundation in accordance with Article V of this policy and the Document Retention and Destruction Policy.

The form of the statement is approved and amended by the Board of Directors as a separate instrument. An amendment to the form does not require an amendment to this policy. The form in effect on the date of this policy is reproduced in Addendum A for reference only; where that reproduction differs from the form approved by the Board, the approved form controls.

A person who becomes aware of an actual or potential conflict of interest between annual statements will disclose it promptly, using the Transaction-Specific Disclosure Form or such other written means as may be appropriate, as provided in Article V.

ARTICLE IX: POLICY ADMINISTRATION AND REVIEW

The Board of Directors is responsible for the administration of this policy. This policy may be updated by the Board of Directors and will be reviewed at least annually. Substantive changes will be announced through the Foundation’s official channels and reflected in the dated version of this policy. The current version of this policy supersedes any prior version.

Addendum A, which reproduces the form of the Annual Disclosure Statement, is not published on this website. The form is approved and amended by the Board of Directors as a separate instrument.