The report, completed by Nygren Consulting, comes as an independent review of conflicts of interest that arose involving board members.

| Read the entire report |

The report on self dealing among UMMS board members comes after the departures of the system's CEOand board members, including former Baltimore Mayor Catherine Pugh. Controversy arose over board members -- including Pugh -- who made money in business deals with the system.

Regarding Pugh's "Healthy Holly" book arrangement, Nygren wrote, "Our review has determined that management did not present the book purchases to the board or any committee for prior approval, as required by then-in-effect Conflict of Interest policies, and the purchase was not subject to any competitive bidding process."

The report concluded that then-CEO Robert Chrencik "agreed to enter into an agreement with Ms. Pugh without consent of the board."

Between 2010 and 2018, UMMS agreed to pay a total of $500,000 for the self-published books Pugh authored. She repaid $100,000.

The report also investigated other former board members and found similar violations of board policies.

UMMS said in a statement that the report details "both management and various board members share responsibility for the lack of transparency and strong, modern governance policies that resulted in improper relationships."

UMMS said the following recommendations have been or will be adopted:

• A new, comprehensive Conflict of Interest Policy was authored by Nygren and accepted by the Board of Directors. The policy was delivered to Maryland's governor, Senate president and Speaker of the House on May 31.
• A Governance Committee will be chartered as a permanent Committee of the Board, and tasked with overseeing all board practices, policies and relationships. All appropriate guiding documents will be authored.
• A new, research-based "competency" model will be implemented to ensure the makeup of the board is determined based on two levels of competencies: those required of each individual member, and those required by the Board as a whole. This will ensure the board is representative of the communities it serves and has the experience and skills necessary to advance the organization's strategic direction and mission.
• The education process related to disclosures and conflicts will be redesigned and will include an official "Code of Conduct" to ensure all board members and senior management are acutely aware of compliance requirements moving forward.
• Board committees will be restructured so chair positions of the Finance Committee and the Audit and Compliance Committee are held by separate individuals, and the chair of the latter maintains no financial or contractual relationship with the organization.

"While Nygren confirmed that outside business interests between a board member and a nonprofit Board of Directors are not uncommon or illegal, great care and caution must be given to ensure there is proper vetting and no real or perceived conflicts of interest. To that end, any proposed professional services agreements with board members will be revealed to the full board, carefully vetted with the Board's Audit and Compliance Committee and reported to the Compliance Officer. The new Conflict of Interest Policy will be strictly adhered to in all cases. Additionally, the system will no longer allow any board member to engage in a personal services agreement, regardless of circumstance," the UMMS statement read.

Upon concerns raised about board business relationships in March, the board and interim CEO John Ashworth took the following actions:

• Conflicted Board members were separated from the board: Board members with personal services contracts with UMMS resigned and board members with professional services contracts with UMMS took voluntary leaves of absence.
• Chrencik was placed on a leave of absence, then separated from the organization.
• Nygren was hired to assess board and corporate financial relationships.
• Performance-based corporate system senior executive bonuses were frozen.
• A new Conflict of Interest Policy was adopted by the board.
• Provisions in SB 619/HB 1428 have been adhered to, according to the legislative timeline.
• A restructure of the UMMS executive team was implemented.

"On behalf of UMMS, I fully accept the findings and recommendations contained in the Nygren report. Collectively, we are both responsible and accountable for what brought us to this point. This report serves as a roadmap -- not only to increase accountability among leaders and establish a more effective Board structure -- but to make progress toward real, lasting cultural change. Policies and procedures are not worth the paper they're written on without an integrity-based culture to enforce them. I am committed to rebuilding that culture and restoring the trust of those that depend on our leadership," Ashworth said in a statement. "No person of authority should benefit personally from a decision he or she makes about the organization they serve. All boards within the system must balance demand for expertise and leadership with conflict-free representation. This is simply not negotiable."