Exhibit 14
CONSUMERS BANCORP, INC.
CONSUMERS NATIONAL BANK
CODE OF ETHICS
Adopted August 13, 2003
A. GENERAL PHILOSOPHY
The honesty, integrity and sound judgment of our employees, officers
and directors are essential to the Company's reputation and success.
This Code of Ethics governs the actions and working relationships of
the Company's employees, officers and directors with current and potential
customers, fellow employees, competitors, government and self-regulatory
agencies, the media, and anyone else with whom the Company has contact. These
relationships are essential to the continued success of the Company. When this
Code of Ethics refers to "the Company," that term includes the Company's
affiliates.
This Code of Ethics:
- requires the highest standards for honest and ethical conduct,
including proper and ethical procedures for dealing with
actual or apparent conflicts of interest between personal and
professional relationships;
- requires full, fair, accurate, timely and understandable
disclosure in the periodic reports required to be filed by the
Company with governmental agencies;
- requires compliance with applicable laws, rules and
regulations;
- addresses potential or apparent conflicts of interest and
provides guidance for employees, officers and directors to
communicate those potential or apparent conflicts to the
Company;
- addresses misuse or misapplication of the Company's property
and business opportunities;
- requires the highest level of confidentiality and fair dealing
within the Company and outside the Company;
- requires proper reporting of any illegal behavior; and
- provides additional specific guidance for the Company's senior
financial officers.
B. CONFLICTS OF INTEREST
A "conflict of interest" occurs when your private interest in any way
interferes - or appears to interfere - with the interests of the Company. You
are expected to avoid all situations that might lead to a real or apparent
material conflict between your self-interest and your duties and
responsibilities as an employee, officer or director of the Company. Any
position or interest, financial or otherwise, that could materially conflict
with your performance as an employee, officer or director of the Company, or
that affects or could reasonably be expected to affect your independence or
judgment concerning transactions between the Company, its customers or
competitors, or otherwise reflects negatively on the Company would be considered
a conflict of interest.
Additional considerations relating to conflicts of interest for
officers and directors of the Company are as follows:
(i) Director Conflicts of Interest. A director's other
relationships, including business, family or those with
non-profits, could occasionally give rise to the perception
that the director has a material, personal interest on a
particular issue involving the Company. The Board of
Directors, after consulting with counsel if the Board deems it
necessary or appropriate, shall determine on a case-by-case
basis whether a conflict of interest actually exists. The
Board of Directors shall take appropriate steps to identify
such potential conflicts and to ensure that all directors
voting on an issue are disinterested with respect to that
issue. For example, a Board member shall discuss his or her
service on another board with the Chairman of the Board if
there is a potential for a conflict of interest. If the
Chairman, in consultation with counsel as appropriate,
identifies a potential conflict, then the Chairman shall raise
the issue with the Audit Committee and the full Board of
Directors if appropriate.
(ii) Officer Conflicts of Interest. An officer's other
relationships, including business, family, or those with
non-profits, could occasionally give rise to the perception
that the individual has a material, personal interest on a
particular issue involving the Company. The Board of Directors
has delegated the task of evaluating certain conflicts of
interest to the Audit Committee. The Audit Committee, after
consulting with counsel if the committee deems necessary or
appropriate, shall determine on a case-by-case basis whether a
conflict of interest actually exists.
C. CONFIDENTIALITY
Nonpublic information regarding the Company or its business, employees
and customers is confidential. As an employee, officer or director, you are
trusted with confidential information. You are only to use such confidential
information for the intended business purpose of the Company. You are not to
share confidential information with anyone outside of the Company, including
family and friends, or with other employees of the Company who do not need the
information to carry out their duties. You may be required to sign a specific
confidentiality agreement in the course of your employment at the Company.
Whether or not a specific
-2-
confidentiality agreement is required of you, your obligation to keep all
information confidential continues even if your employment with the Company
ends.
The following is a non-exclusive list of confidential information:
(i) material, non-public financial information regarding the
Company or any of its subsidiaries or affiliates;
(ii) trade secrets, which include any business or technical
information, such as a program, method, technique, compilation
or information that is valuable because it is not generally
known;
(iii) all rights to any invention or process developed by an
employee using the Company's facilities or trade secrets,
resulting from any work for the Company, or relating to the
Company's business, is considered to be "work-for-hire" under
the United States copyright laws and belongs to the Company;
and
(iv) proprietary information such as customer lists and
confidential tenant information.
All public and media communications involving the Company must have
prior clearance by the Company's senior management.
D. BUSINESS OPPORTUNITIES OF THE COMPANY
Using confidential information about the Company or its business,
employees, officers, directors or customers for personal benefit or disclosing
such information to others outside your normal duties is prohibited.
Employees, officers and directors are prohibited from:
(i) personally benefiting from opportunities that are discovered
through the use of the Company's property, or through their
contacts, information or position with the Company;
(ii) accepting employment or engaging in a business (including
consulting or similar arrangements) that may conflict with the
performance of your duties for the Company or the Company's
business interest;
(iii) soliciting, demanding, accepting or agreeing to accept
anything of value from any person in conjunction with the
performance of your employment or duties for the Company; or
(iv) acting on behalf of the Company in any transaction in which
you or any member of your immediate family (spouse, children
or others living with you) has a significant direct or
indirect financial interest.
-3-
There are certain situations in which you may accept a personal benefit
from someone with whom you transact business such as:
(i) accepting a gift in recognition of a commonly recognized event
or occasion (such as a promotion, new job, wedding, retirement
or holiday). An award in recognition of service and
accomplishment also may be accepted without violating this
Code of Ethics so long as the gift does not exceed $500 from
any one individual in any calendar year;
(ii) accepting something of value if the benefit is available to
the general public under the same conditions on which it is
available to you; or
(iii) accepting meals, refreshments, travel arrangements and
accommodations and entertainment of reasonable value in the
course of a meeting or other occasion to conduct business or
foster business relations if the expense would be reimbursed
by the Company as a business expense if the other party did
not pay for it.
E. INSIDER TRADING
It is both unethical and illegal to buy, sell, trade or otherwise
participate in transactions involving the Company's securities while in
possession of material information concerning the Company that has not been
released to the general public, but which when released may have an impact on
the market price of the Company's securities. It is also unethical and illegal
to buy, sell, trade or otherwise participate in transactions involving the
securities of any other company while in possession of similar non-public
material information concerning such company. Any questions concerning the
propriety of effecting a transaction in the Company's (or other company's)
securities should be directed to the Company's Chief Financial Officer.
F. OUTSIDE BUSINESS RELATIONSHIPS
Before agreeing to act as a director, officer, consultant or advisor
for any other business organization, you should notify your immediate
supervisor.
Directors should disclose all new directorships or potential
directorships to the Chairman of the Board of Directors in order to avoid any
conflicts of interest and to maintain independence.
The Company encourages civic, charitable, educational and political
activities as long as they do not interfere with the performance of your duties
on behalf of the Company. Before agreeing to participate in any civic or
political activities, you should contact your immediate supervisor.
Employees who are considering outside employment shall notify their
manager or supervisor before accepting such employment. The manager or
supervisor will review outside employment requests for potential conflicts of
interest.
-4-
G. FAIR DEALING
Each employee, officer and director should undertake to deal fairly
with the Company's customers, competitors and employees. Additionally, no one
should take advantage of another through manipulation, concealment, abuse of
privileged information, misrepresentation of material facts or any other unfair
business practices.
At or prior to their hiring date, employees must disclose the existence
of any employment agreement, non-compete or non-solicitation agreement,
confidentiality agreement or similar agreement with a former employer that in
any way restricts or prohibits their performance of any duties or
responsibilities of their positions with the Company. Copies of such agreements
should be provided to the corporate secretary of the Company to permit
evaluation of the agreement in light of the employee's position. In no event
shall an employee use any trade secrets, proprietary information or other
similar property, acquired in the course of his or her employment with another
employer, in the performance of his or her duties for or on behalf of the
Company.
H. EQUAL EMPLOYMENT OPPORTUNITY
The Company is an equal employment opportunity employer. Employment
decisions are based on merit and business needs, and not on race, color,
national origin, ancestry, sex, age, religion, veteran status, or any other
factor protected by law. The Company will make reasonable accommodation for
employees with disabilities, provided that the individual is otherwise qualified
for and can safely perform the essential duties and assignments connected with
the job.
I. PROTECTION AND PROPER USE OF COMPANY PROPERTY
All employees, officers and directors should protect the Company's
property and assets and ensure their proper use. Theft, carelessness and waste
can directly impact the Company's profitability, reputation and success.
Permitting the Company's property (including data transmitted or stored
electronically and computer resources) to be damaged, lost or used in an
unauthorized manner is strictly prohibited. Employees, officers and directors
may not use official stationery for personal purposes.
J. COMPLIANCE WITH LAWS, RULES AND REGULATIONS
This Code of Ethics is based on the Company's policy that all
employees, officers and directors comply with the law. While the law prescribes
a minimum standard of conduct, this Code of Ethics requires conduct that often
exceeds the legal standard.
K. REPORTING OF ILLEGAL OR UNETHICAL BEHAVIOR
All employees, officers and directors are expected to demonstrate the
ability to properly manage their personal finances, particularly the prudent use
of credit. The Company recognizes that its employees and customers must have
faith and confidence in the honesty and character of its personnel. Fraud can
significantly affect the reputation and success of the Company. The Company
requires its employees, officers and directors to talk to supervisors, managers
or other
-5-
appropriate personnel to report and discuss any known or suspected criminal
activity involving the Company or its employees. If, during the course of your
employment, you become aware of any suspicious activity or behavior, including
concerns regarding questionable accounting or auditing matters, you must report
suspected violations of laws, rules, regulations or this Code of Ethics to a
member of the Company's senior management. Reporting the activity will not
subject the employee to discipline absent a knowingly false report. Any employee
who, in good faith, reports a violation or possible violation of the Code of
Ethics or the underlying corporate policy is protected against retaliatory
behavior. The Company is not permitted to fire, demote, suspend, harass or
discriminate against any employee who lawfully provides information to, or
otherwise assists or participates in, any investigation or proceeding by a U.S.
regulatory or law enforcement agency, any member of the U.S. Congress or a
Congressional committee or the employee's manager, relating to what the employee
reasonably believes is a violation of the securities laws or an act of fraud.
All reports will be treated confidentially to the extent possible.
The Company has established the following address available to anyone
wishing to bring any such matter to the attention of management or the Board of
Directors. The address is Chairman of the Audit Committee: 525 West Lincolnway,
Minerva, Ohio 44657. You are NOT required to identify yourself. Anonymous
reports also receive a full inquiry.
L. ADMINISTRATION AND WAIVER OF CODE OF ETHICS
This Code of Ethics shall be administered and monitored by the
Company's Executive Committee. Any questions and further information on this
Code of Ethics should be directed to the Chairman of the Executive Committee.
All managers and direct supervisors are responsible for reviewing this
Code of Ethics with their subordinates each time a new edition of the Code of
Ethics is published. This Code of Ethics also is available on the Company's web
site at: www.consumersbank.com or www.sec.gov.
The provisions of this Code of Ethics will be included in the Company's
Employee Handbook. The Employee Handbook will be issued to all new employees and
officers at the time of employment and reissued to existing employees and
officers from time to time. Employees will be required to sign a receipt form
for the Employee Handbook indicating they have read this Code of Ethics and will
comply with its provisions.
Employees, officers and directors of the Company are expected to follow
this Code of Ethics at all times. In rare circumstances, situations may arise in
which a waiver may be appropriate. Waivers will be determined on a case-by-case
basis by the Company's senior management with the advice of the Company's
counsel. However, waivers for directors and officers may only be granted by the
Audit Committee of the Board of Directors, which shall have the sole and
absolute discretionary authority to approve any deviation or waiver from this
Code of Ethics. Any waiver for directors or officers, and the grounds therefore,
shall be disclosed to stockholders in accordance with applicable laws and
regulations.
Known or suspected violations of this Code of Ethics will be
investigated and may result in disciplinary action up to and including immediate
termination of employment from the Company.
-6-