Conflicts of Interest

A conflict of interest happens when an individual or corporation has interests that, when combined, could corrupt their motivation or undermine their impartiality. For example, exploitation of a situation for personal or corporate gain. A conflict of interest can be avoided by disclosing it at an early stage to all parties involved. Depending on the circumstances, other steps may need to be taken to resolve the conflict or potential conflict. We have guidelines that will help you avoid conflicts of interest. Start by asking yourself… is this ethical workplace conduct?

Maria
“My team was tasked with sourcing a new supplier. One of the bidders turned out to be my brother-in-law. I knew I couldn’t give him the contract without disclosing the connection to my employer, as even the perception of a conflict of interest could affect my reputation.”

Julio
“I am careful to avoid any potential conflicts of interest at work. By being able to recognize potential problems before they become issues, I can protect myself professionally and legally from conflicts of interest.”

Sandra
“I started dating my manager and hoped that because we disclosed our relationship to Human Resources that we could carry on our respective roles. Unfortunately, our relationship was deemed a conflict of interest for my manager, and I was moved to a different team.”

Michael
“A competitor offered me part-time work outside of my day job. I needed the money, so accepted. I didn’t think I was doing anything wrong but was soon called to a meeting with HR as it was deemed a conflict of interest.”innuendos, or sexual advances. It is enough that the conduct, whether blatant or subtle, discriminates against a person on the basis of his or her gender/sex.

Contract Renewal

Carlotta is renewing a contract with a supplier. The supplier, a small business, is growing fast. It has just asked Carlotta’s father-in-law to sit on the board of directors.

  •  No, the company is an existing supplier, so the family connection is irrelevant.
  •  Yes, this is a clear conflict of interest, as there is a family connection that should be disclosed.
  •  No, Carlotta is not involved in sourcing suppliers, only signing and renewing contracts, so there is no conflict of interest.

A potential conflict of interest is authorizing, or causing another to authorize, a business transaction with a relative or any business organization with which the employee or relative is associated. If you fail to disclose a connection between yourself, or your family, and a supplier, you are opening both yourself and our company up to accusations of favoritism and unethical behavior.

Hiring Decision

Ernest’s administrative assistant, Fiona, was involved in an accident just as his team is preparing to launch a company-wide initiative. His daughter interned for the company last year, so is familiar with their operations. Ernest is considering hiring his daughter as a temporary employee during Fiona’s extended absence.

  • No, hiring a relative to fill a position is a conflict of interest, as the recruitment process isn’t transparent.
  • Yes, his daughter has already been through the company recruitment process, so can be taken on.
  • Yes, but only if he keeps his daughter on long-term.

A potential conflict is hiring a relative to fill a vacant position. Might you have hired your relative instead of another more-qualified applicant? It makes no difference whether your relative was the most qualified applicant; were it not for your relationship, you might have posted the position. If you hire a family member, this could be viewed as nepotism and unethical behavior. You always need to follow the proper recruitment process to fill a position.

Consulting work

Bree has been offered some consulting work with a competitor at weekends.

  • Yes. Bree must first emphasize to the competitor that she won’t share any important information about her role with her current employer.
  •  Yes. As long as Bree ensures that any consulting work doesn’t impact on the hours she normally works for our company, this would be fine.
  • No. Bree would be facing a potential conflict of interest if she took the consulting work with a competitor.

Bree now has a better understanding of the fact that doing any work for any outside company could be seen as a conflict of interest. A potential conflict of interest is maintaining outside employment with, or providing consulting services to, any competitor, vendor, or customer. Policies on this range from not allowing outside employment by full-time staff to case-by-case approval by a senior member of management.

  • Recognize situations that may lead to a conflict of interest.
  • Disclose any potential conflict of interest immediately to all parties.
  • Take appropriate action to resolve the conflict

This content is an extract from the workplace conduct booklet

Download our Ethics in the Workplace booklet.
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