Ethics
and Conflict of Interest
by
Michael McDonald
You've seen the headlines, "Politician
caught in conflict of interest " or "professional denies
conflict of interest allegations. " You probably were thankful
that you were not the subject of the newspaper story. But you
also may have wondered what exactly is a conflict of interest,
why such conflicts are ethically significant, and what you can
do to avoid being in one.
Definition
I define a conflict of interest as "a
situation in which a person, such as a public official, an employee,
or a professional, has a private or personal interest sufficient
to appear to influence the objective exercise of his or her official
duties. " There are three key elements in this definition.
First, there is a private or personal interest. Often this is
a financial interest, but it could also be another sort of interest,
say, to provide a special advantage to a spouse or child. Taken
by themselves, there is nothing wrong with pursuing private or
personal interests, for instance, changing jobs for more pay
or helping your daughter improve her golf stroke.
The problem comes when this private interest
comes into conflict with the second feature of the definition,
an "official duty" -- quite literally the duty you
have because you have an office or act in an official capacity.
As a professional you take on certain official responsibilities,
by which you acquire obligations to clients, employers, or others.
These obligations are supposed to trump private or personal interests.
Third, conflicts of interest interfere with
professional responsibilities in a specific way, namely, by interfering
with objective professional judgment. A major reasons clients
and employers value professionals is that they expect professionals
to be objective and independent. Factors, like private and personal
interests, that either interfere or appear likely to interfere
with objectivity are then a matter of legitimate concern to those
who rely on professionals -- be they clients, employers, professional
colleagues, or the general public. So it is also important to
avoid apparent and potential as well as actual conflicts of interests.
An apparent conflict of interest is one which a reasonable person
would think that the professional's judgment is likely to be
compromised. A potential conflict of interest involves a situation
that may develop into an actual conflict of interest.
Leading examples
With
this in mind, consider the following types of typical conflicts
of interest listed by Canadian political
scientists Ken Kernaghan and John Langford in their book, The
Responsible Public Servant. They list seven categories:
[1] Self-dealing. For example, you work
for government and use your official position to secure a contract
for a private consulting company you own. Another instance is
using your government position to get a summer job for your daughter.
[2] Accepting benefits. Bribery is one
example; substantial [non token] gifts are another. For example,
you are the purchasing agent for your department and you accept
a case of liquor from a major supplier.
[3] Influence peddling. Here, the professional
solicits benefits in exchange for using her influence to unfairly
advance the interests of a particular party.
[4] Using your employer's property for private
advantage. This could be as blatant as stealing office
supplies for home use. Or it might be a bit more subtle, say,
using software which is licensed to your employer for private
consulting work of your own. In the first case, the employer's
permission eliminates the conflict; while in the second, it
doesn't.
[5] Using confidential information. While
working for a private client, you learn that the client is planning
to buy land in your region. You quickly rush out and buy the
land in your wife's name.
[6] Outside employment or moonlighting. An
example would be setting up a business on the side that is in
direct competition with your employer. Another case would be
taking on so many outside clients that you don't have the time
and energy to devote to your regular employer. In combination
with [3] influence peddling, it might be that a professional
employed in the public service sells private consulting services
to an individual with the assurance that they will secure benefits
from government: "If you use my company, I am sure that
you will pass the environmental review."
[7] Post-employment. Here a dicey situation
can be one in which a person who resigns from public or private
employment and goes into business in the same area. For example,
a former public servant sets up a practice lobbying the former
department in which she was employed.
Some tests
How do you determine if you are in a conflict
of interest, whether actual, apparent, or potential? The key
is to determine whether the situation you are in is likely to
interfere or appear to interfere with the independent judgment
you are supposed to show as a professional in performing your
official duties. A good test is the 'trust test': would relevant
others [my employer, my clients, professional colleagues, or
the general public] trust my judgment if they knew I was in this
situation. Trust, in my opinion, is at the ethical heart or core
of this issue. Conflicts of interest involve the abuse, actual
or potential, of the trust people have in professionals. This
is why conflicts of interest not only injure particular clients
and employers, but they also damage the whole profession by reducing
the trust people generally have in professionals.
In fact, the 'trust test' suggests one very
good way of dealing with a conflict of interest: reveal your
private interest in the matter to relevant parties. Often if
we let others know what might be influencing our judgment, they
can be on their guard and not caught unaware.
But sometimes it isn't enough to know that
there is a particular private interest influencing a professional's
judgment; the client, employer, etc. expects that the professional
will stay out of such situations. So the second way to avoid
conflicts of interests is to absent yourself from decision making
or advice giving if you have a private interest. So in the case
of potential self-dealing, the conscientious professional will
say that she can't be involved in a situation where she is both
bidding on a government contract and deciding as a public servant
who is awarded the contract. She will either step aside and completely
[and, I mean, completely] absent herself from determining who
gets the contract or refrain from bidding on such contracts in
the first place -- which is probably the wisest course of action.
A final word
It may take some skill and good judgment to
recognizing that you are in a conflict of interest situation.
This is because private and personal interests can cloud a person's
objectivity. So it may be a lot easier to recognize when others
are in a conflict, than when you are. This suggests that it may
be useful to talk to a trusted colleague or friend when you are
in doubt.
But once you recognize that you are in or are
headed into a conflict of interest situation, the ethical responses
are straightforward: get out of the situation, or, if you can't,
make known to all affected parties your private interest. These
responses will preserve the trust essential to professional objectivity.
It is important to realize that avoiding conflicts
of interest is only one part of being a conscientious professional.
Another part is the difficult task of making choices when the
ethics of the situation aren't clear or when there are good moral
reasons for acting in diametrically opposing ways. This is typical
in the case of whistle blowing, in which a duty of loyalty to
a client or employer counsels confidentiality but this conflicts
with a duty to warn the public of a serious harm or danger.
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