While governance officials have a responsibility to represent their constituencies, “they are ultimately obligated to work in the best interests of the Global Fund,” according to a code of ethical conduct adopted by the Board at its meeting in Geneva on 31 March–1April 2015.
The Board also approved the terms of reference of the Ethics Officer. The Fund described these developments as “second stage deliverables” in a three-stage process. The first stage was the adoption of an ethics and integrity framework in November 2014 (see GFO article). The third stage will include development of mechanisms to further integrate ethics and integrity within Global Fund operations, particularly at grant level.
The Secretariat has prepared a draft of a guidance document on ethical roles and responsibilities of governance officials.
Tension between board members acting in the best interests of the Fund and representing their constituencies was of one two key issues that emerged from consultations on the code of ethical conduct. The other was how the Board should deal with conflicts of interest.
With respect to the first issue, the code states that the best interests of the Fund must take priority. “While governance officials’ responsibilities to constituencies are to be respected,” the code says, the welfare of the Fund come first, and officials should seek advice from the Ethics Officer where constituency requirements conflict with the interests of the Global Fund. “Governance Officials are expected to act with an understanding that the Global Fund’s direction is shaped by incorporating and balancing varying constituency interests.”
The code also states that governance officials are “accountable to the Global Fund” and, in addition, “share accountability to all Global Fund constituencies.”
The draft guidance document states that in order for governance officials to act in the best interests of the Fund, “it is often necessary for [them] to demonstrate flexibility with respect to constituency positions and openness to the views of others”.
Concerning conflict, the code states that “a conflict of interest occurs when a governance official has a competing interest, such as a personal or financial interest, which could have a real, perceived or potential effect on his/her ability to act with the best interests of the Global Fund”.
The draft guidance document provides the following examples of situations that could create conflicts of interest:
- a Board member is hired as a consultant to develop a funding proposal for a Global Fund grant
- a Board member is employed by a manufacturer of health products used in Fund programs
- a Board member is the head of an organization nominated to be a principal recipient
The code of ethical conduct states that experiencing a real, perceived or potential conflict of interest does not constitute ethical misconduct -- provided it is disclosed at the outset.
The code states that if ethical misconduct occurs, remedial actions will be determined on a case-by-case basis and may include formal reprimand, conditional removal from the Board or a committee, or indefinite removal.
The Ethics Officer will report directly to the Board through the Audit and Ethics Committee. The officer's responsibilities will include, among others, ensuring sound and effective ethical risk management; providing advice to governance officials on ethics matters; and undertaking preliminary reviews of potential ethical misconduct. Where appropriate, the Ethics Officer will refer cases of potential misconduct to the Office of the Inspector General. The Ethics Officer will be located within the OIG for administrative purposes, but will be an independent office. The terms of reference for the position have yet to be approved, which was noted by many constituencies during discussions.
Various constituencies also expressed concern during the Board discussions that the ethics code, too, appeared unfinished. Reservations about voting on a work in progress were, ultimately, assuaged by reassurances from the Secretariat that this was a process that had just begun rather than something that had been completed, providing ample opportunity for further consultations.
The Ethics Officer is appointed to a three-year term, renewable once. Following completion of the term(s), the Ethics Officer will be ineligible for future employment by the Global Fund.
The report (GF-B33-15) on the “Ethics and Integrity Initiative: second stage Proposals” should be available shortly here. The following annexes will also be posted on that site: “Code of Ethical Conduct for Governance Officials”; “Terms of Reference of the Global Fund Ethics Officer”; and “Ethical Roles and Responsibilities of Global Fund Governance Officials” (the guidance document).