Aaron C

92 karmaJoined


Cautiously optimistic here. It should be noted that since the Phase 2 trial showed efficacy dependent on the amount of Matrix M adjuvant used, the adjuvant providing company, Novavax will need to execute better with its manufacturing partners than it has shown it is capable of. Though this company has historically conducted many clinical trials, it has dropped the ball on execution. It failed a phase 3 RSV trial due to arguably unfit trial endpoints and despite being awarded $1.6 B in Operation Warp Speed money for its COVID vaccine, has drastically underperformed in delivering to all markets, including its committed doses to COVAX due to manufacturing slowness/lack of regulatory capture in the US (I'd say only partly their fault here given FDA slow walking them) and deficiencies in licensing and manufacturing expertise (even when working with Serum Institute of India). They started to cancel manufacturing subcontracts, triggering reneg payment settlement clauses (i.e. $185M to Fujifilm Diosynth, GAVI pulling out of a $700M covid vaccine deal due to failure to deliver in time), and in cases where trials were effective such as its flu candidate which passed phase 3 before the pandemic, their vaccine still has not reached patients commercially (Nanoflu, which showed cross-reactive polyfunctional CD4+ T-cell responses and outperformed Sanofi’s quadrivalent Fluzone in a head to head trial).

Been following Novavax since they're in my backyard in the DC metro area and knew people in their COVID vaccine trial (protein subunit, even slightly outperformed Moderna/Pfizer in some efficacy and side effects metrics.... But very few people ended up getting it compared to Moderna/Pfizer due to lateness to market). Stock went from highs ~$250/share during COVID to now ~$8 arguably due to mismanagement (CEO finally recently stepped down). Would be a pity if the company continues its pattern of misfiring here; hope it doesn't fold, and hopefully if they're just providing matrix M they don't end up being the bottleneck in full manufacturing. Case study in better management/Institutional decision making as an EA cause area in my opinion.

Wonder if there might be some avenue of leading groups holding equity stakes in each other as an angle of aligning incentives. Imperfect analogy is in the auto industry, for example how Toyota/ Subaru and others hold equity in each other and share best practices in safety/hybrid tech.

My original comment mentions 'can lead to hazards' due to not knowing the details of what went down/being relatively new (couple months) to the EA space.  However subsequent comments of individual regrantors needing to self 'reinvent the wheel'  around COI policies (btw, I think Linch came to a good equilibrium for his particular situation) and other concerns raised in the past I think confirm the hunch that this is an area of improvement. 

Yes, that is one function of boards.  Funders also ideally function objectively when choosing who to fund.   Not so hypothetical example: Foundation can fund grantee A or B.  Foundation employee making the decision is board member/trustee of B with fiduciary duties to B. Should foundation employee fund A or B? Conflict. Employee should probably recuse themselves from the decision making process and document.  If employee was a board observer on B with no decision making power at B, it might be ok, but might still a good idea to recuse themselves from the fund distribution process if want to be safe/ doubly above board. 

Most folks who have been required to go through COI learning modules for work can attest to how fun they are <sarcasm>, but I guess I'm seeing the importance now. There are general good practices because of problems that arise with   'self serving'  and I think the policies of well known foundations speak for themselves and are instructive if anyone wants to dive deeper.    I included COI policies from MacArthur Foundation and Bill and Melinda Gates Foundation and they are similar to policies in the government contracting and healthcare spaces which are more regulated. For reference, MacArthur states that "a grant is material to an entity when the amount of the grant is in excess of five percent (5%) of the revenue of the entity."  I suspect that is the case in several EA orgs, so may be good to at least revisit their COI policies in light of recent events.

One key thing is a person's degree of decision making power in the funder org vs grantee org and situations of recusal when a COI is identified.  I think what the NYT author is getting at by just stating the facts and offering little commentary is that how things have operated does not pass the sniff test for having functioning COI policies (from outside looking in).  Happy to update thinking if there is evidence to the contrary that these COIs were brought up and CEA/FTX Foundation worked through them (general best practice, see 'record and reporting' section of the MacArthur Foundation policy below).  I.e. credit to EA Infrastructure Fund, from a quick search I noticed they mentioned COIs under "Why you might choose not to donate to this fund" so at least some things are working: " You have concerns about conflicts of interest or grantmaker independence: All members of the fund management team are actively involved in the effective altruism community and have both professional and personal relationships with many of those working at meta organizations that may receive grants from this fund. Nick Beckstead (an advisor to the Fund) is a member of the Centre for Effective Altruism's board."

MacArthur Foundation COI Policy: Link and selected sections below

An entity includes a corporation, partnership, limited liability company, trust, organization, coalition, commission, university or institute (including a school, department, center, committee, or research project within a university or institute).

The principal executive officer includes the executive head or co-head of an entity, including the principal investigator of a research project or the co-chair of a commission or other entity.

A material affiliation with an entity or individual exists when a director, staff, an investment committee member, or a related party has any of the following types of relationships with the entity or individual:

  • Is a board member, officer, or employee of the entity;
  • Is the owner of more than five percent (5%) of the ownership interest of the entity;
  • Is a lender to the entity;
  • Is a landlord to or tenant of the entity;
  • Has an ongoing contractual relationship to provide goods or services that is significant to the Foundation representative, a related party, or the entity or the individual to whom the goods or services are being provided; or
  • Is a blood relative of the individual.

A material financial interest with an entity exists when a Foundation director, staff, an investment committee member or a related party:

  • Holds an ownership interest in excess of five percent (5%) of the total equity interest in such entity; or
  • Is a consultant or service provider to the entity and is paid an amount that exceeds five percent (5%) of his/her overall income or the overall income of a related party to such individual; or
  • Is a lender to the entity and such loans are more than five percent (5%) of the indebtedness of such entity.

A grant is material to an entity when the amount of the grant is in excess of five percent (5%) of the revenue of the entity.

Whether a director, staff, an investment committee member or a related party derives a “significant personal benefit” or has a “relationship to provide goods or services that is significant will depend on the facts and circumstances of each case, including an assessment of whether an objective person would consider the benefit capable of affecting the individual’s objectivity or independence.


This Policy is intended to cover any proposed grant, investment or other Foundation business transaction in which there is a conflict of interest.

A conflict of interest will be present if an individual knows that he/she or a related party has a material affiliation with or a material financial interest in the entity or with the individual involved in the transaction, or will otherwise benefit financially or derive a significant personal benefit as a result of the transaction.

The Foundation will not proceed with the following transactions in which a conflict of interest is present:

  1. A grant to or for the benefit of an entity in which a director, staff or an investment committee member is the principal executive officer and the grant is material to the entity.
  2. An investment or other transaction that will give rise to payment of fees, income, or profits to a director, staff or an investment committee member, or an entity in which any such individual has a material financial interest. This provision does not prevent an investment by the Foundation in an entity in which a director, staff or an investment committee member is also an investor if the investment committee concludes after disclosure of relevant facts that such investment by the Foundation is in the best interests of the Foundation.

In all other transactions involving a conflict of interest, a disinterested decision-maker (the board, the investment committee, or the president, as the case may be) will determine whether proceeding with the transaction is in the best interests of the Foundation after considering all the facts and circumstances.

Directors, investment committee members, and staff who have a conflict of interest regarding a proposed grant or transaction should not vote on or approve the grant or transaction. In addition, a staff member should not work on the grant or transaction where the conflict is present and, unless asked by another director or the president, a director, an investment committee member or a staff member should not participate in formal or informal discussions of such grant or transaction.

The chair of the board or the chair of the investment committee, as the case may be, in consultation with the president and the general counsel, will determine whether a director or staff member with a material affiliation should also be excused from the meeting when the matter is being discussed.

The prohibition against participation in the grant process does not apply when an individual is affiliated with a grantee at the written request of the Foundation. Any such request must be made by the president in the case of a staff member and approved by the chair of the board in the case of the president.

The Foundation will maintain a record of actions taken when there is a conflict of interest present with respect to any grant or transaction.

The general counsel will provide an annual report to the audit committee reflecting all transactions in which there was a conflict of interest and the actions taken.

Bill and Melinda Gates COI Policy: Link and selected sections below


Q. I am (or a family member is) an officer/board member of an organization that has received, or might receive, a grant from the foundation. Is this a conflict of interest? 
A. A potential conflict of interest arises if (i) you have decision-making authority at the foundation over whether a grant is made to an organization on whose board you serve (or a member of your family serves), (ii) you have (or a family member has) decisionmaking authority over how such funds are expended by the potential grantee and you manage the grant for the foundation, or (iii) you receive (or a family member receives) compensation from the organization because of your position as an officer or director of the organization. • You should disclose your position with the organization to the foundation as required by our Conflict of Interest Policy and also follow the requirements of the other organization’s Conflict of Interest Policy. • You should refrain from exercising decision-making authority with respect to the grant (both at the foundation and at the grantee) and also from assisting the grantee or potential grantee with preparing or submitting grant proposals to the foundation. • In some cases where your family member is directly involved in managing the foundation’s grant at the grantee organization, it also may be necessary to recuse yourself from managing the grant, even if someone else at the foundation approved the grant. If this is the case, please consult the Legal Team. 

Q. I am on an advisory board or a nonvoting board member of an actual or potential foundation grantee. Do I have to refrain from making decisions regarding a grant from the foundation? 
A. If the advisory board’s recommendations are not binding on the grantee’s board of directors or you do not actually have the right to vote on decisions made by the organization’s board, then it is unlikely that your relationship with the grantee creates an actual conflict of interest. • Nevertheless, you should be sensitive to whether there are any issues of appearance of conflict and not otherwise use your position to exercise undue influence (e.g., if the organization defers to you because you are its tie to substantial foundation grant funds). Your relationship with the other organization should be disclosed to the foundation and you should follow the requirements of the other organization’s Conflict of Interest Policy. 

Q. I have been asked to serve as a board member of a foundation-sponsored organization as part of the performance of my employment responsibilities. Is there a conflict of interest? 
A. This situation presents one of the most challenging sets of conflicts issues for the foundation. A conflict of interest can exist even though you serve on the board of a foundation-sponsored organization as part of your employment responsibilities at the foundation. • You should disclose your board position with the organization on the foundation’s Conflicts Questionnaire as required by our Conflict of Interest Policy and also follow the requirements of the other organization’s Conflict of Interest Policy. • For the protection of the foundation employee, the foundation and the grantee, and as a matter of good corporate practice, board minutes should reflect a clear record of disclosure and explicit recusal (abstention from voting) by the foundation employee whenever matters on the agenda or under discussion present a conflict of interest between the other organization and the foundation. • A foundation employee serving in this capacity should consciously think about his/her dual roles and which capacity he/she is acting when presented with decisions regarding foundation grants. As a foundation employee, you have certain duties to the foundation, including the obligation to refrain from disclosing, to a grantee or others, foundation confidential information learned in the course of your employment. As a board member, you owe fiduciary duties of care, loyalty and confidentiality to the grantee, which under law may supersede your duties to the foundation as an employee. 

o The duty of care requires a director to act in accordance with the best interests of the organization on whose board the director serves, irrespective of other entities with which the director is affiliated, or to which the director owes his or her board appointment. This duty calls upon a director to be informed and to exercise independent judgment when participating in the board’s decisions and its oversight of the organization and its management. 
o The duty of loyalty primarily relates to conflicts of interest, corporate opportunity and confidentiality. The duty of loyalty requires that a director (i) be conscious of any potential conflicts of interest he or she may have, and (ii) act with candor and care in dealing with situations in which a conflict exists. 
o Confidentiality obligations require that information learned in the course of serving as a director be held in confidence and that board members refrain from disclosing information they receive in this capacity to the foundation or to others without the consent of the organization. You should check with the grantee or contractor regarding its confidentiality policy, and, as appropriate, refrain from disclosing confidential information to the foundation or to others, without prior approval. 
o It is important that these fiduciary duties be kept in mind even where you serve on the board of a foundation grantee primarily to ensure good stewardship of foundation grant funds and the accomplishment of foundation programmatic objectives. For example, if a foundation employee serving on the board of directors of a grantee becomes aware as a result of such position (versus through his/her role as a program officer) that the grantee is considering changing the manager of a project funded with foundation funds, it could be a breach of the individual’s duties of loyalty and confidentiality to the grantee to inform the foundation of such change, without the grantee’s prior consent. 

• If it is not feasible for you to recuse yourself from participating as a board member of the grantee when decisions with respect to the foundation’s grant to the organization are being made, you should document that your manager at the foundation has approved any final decisions with respect to the foundation’s grant to the organization. The key is that you should not be in a decision-making position on both sides of the grant. 
• Finally, the “safe harbors” under Federal tax laws that protect the foundation from being considered responsible for “tipping” a public charity include as a condition the requirement that the foundation not be “controlled directly or indirectly by the grantor.” A grantee is “controlled” for purposes of these rules if by “aggregating votes or positions of authority, the foundation may require the grantee to perform any act which significantly affects its operations or may prevent the grantee from performing such act.” Holding a minority of the grantee’s board seats should typically not satisfy this test, however, where the foundation is the primary funder of the organization, sensitivity to this issue is important. 

Q. I am on the board of an organization (which may include a for-profit company) that does not conduct business with the foundation. Do I need to disclose the relationship as a potential conflict? 
A. The foundation’s Conflict of Interest Policy requires that employees disclose all of their board affiliations, even if there is no current conflict of interest. • It is important for the foundation to have this information as the foundation might engage with the organization in the future and we need a complete database to identify potential conflicts of interest as part of conducting due diligence. • Note that time spent on board activity on behalf of for profit entities or otherwise not related to foundation business and our mission should be taken as personal, vacation days, and any travel and other related expenses should be paid for personally and not charged to the foundation. 

Q. I have (or a family member has) a financial interest, through ownership or investment, in an entity with which the foundation proposes to do business or to which it may make a grant. Does a conflict of interest exist? 
A. Holding a financial interest in an organization does not necessarily create a conflict of interest. It will depend upon the facts and your role as a foundation employee in selecting the entity for the proposed transaction.  
• If the employee with the financial interest in the organization does not have a role in selecting or negotiating the terms of engagement or grant with the organization and an independent foundation manger determines that the transaction is fair, reasonable and in the best interests of the foundation, the foundation may proceed with the transaction in accordance with the steps outlined in Question 3 above. Potential appearance of conflict of interest issues should be taken into account in making this decision. 
• In all cases, transactions with a for-profit organization in which a foundation employee has a financial interest will be scrutinized closely to ensure that no improper benefits will be derived by the employee as a result of the transaction.

The last paragraphs in the article itself point to the most glaring issue IMO-loose norms around board of directors and conflicts of interests (COIs) between funding orgs and grantees. The author presents it in a way that it's self evident the boards were not constructed in a way to be sufficiently independent / objective, and having substantial overlap between the foundation board and the boards of the largest grantees can lead to hazards. These are common industry issues in corporate oversight, curious what policies there are among EA orgs to decrease COIs.

"A significant share of the grants went to groups focused on building the effective altruist movement rather than organizations working directly on its causes. Many of those groups had ties to Mr. Bankman-Fried’s own team of advisers. The largest single grant listed on the Future Fund website was $15 million to a group called Longview, which according to its website counts the philosopher Mr. MacAskill and the chief executive of the FTX Foundation, Nick Beckstead, among its own advisers.

The second-largest grant, in the amount of $13.9 million, went to the Center for Effective Altruism. Mr. MacAskill was a founder of the center. Both Mr. Beckstead and Mr. MacAskill are on the group’s board of trustees, with Mr. MacAskill serving as the chair of the United Kingdom board and Mr. Beckstead as the chair of the U.S. subsidiary.

The FTX Foundation itself had little to no oversight beyond Mr. Bankman-Fried’s close coterie of collaborators. According to its website, the board of the FTX Foundation comprised Caroline Ellison, the head of Alameda Research, the hedge fund Mr. Bankman-Fried founded; Gary Wang, the chief technology officer of FTX; and Nishad Singh, director of engineering at FTX."