Aconflict of interest declarationis an essential tool in ensuring that everyone involved in discussions or decisions regarding your organisation is serving in the best interest of the business. Recently, it was revealed that the Federal Coalition government was aware of aconflict of interest of staff involved in the $30m land purchase near Western Sydney Airport but failed to act upon it.Despite making self-declared conflicts of interest, it was found that six staff were involved with one particular adviser that was permitted to continue to work on the project despite declaring a conflict of interest. The result? A piece of land known as the Leppington Triangle being sold for $26.7m more than what it’s valued (at the taxpayers’ expense). While all staff did declare conflicts of interest, failure to act on this was equally detrimental, with negative exposure of the program and in this case, the government, for not appropriately identifying and addressing this conflict. This is one of many types of conflicts of interests that businesses and organisations often find themselves at risk of.
By implementing conflict of interest declarations and making them a regular part of your organisation’sscreening practices, you can havepeace of mindthat everyone is doing their best to makenon-biasedand informed decisions.
What is a Conflict of Interest?
A conflict of interest can exist when it’s likely that an employee could beinfluenced, or could be perceived as being influenced, by their personal interests while they’re carrying out their duties.
There are three types of conflicts of interests:
- Real– where there is a direct conflict between current personal interests and everyday official duties.
- Apparent– where it could be perceived that an individual’s personal interests are having an improper influence on official duties, regardless of whether or not this is the case.
- Potential– where personal interests are not currently but could potentially come into direct conflict with official duties.
Conflicts of interest arerelatively commonand don’t always become a problem, as long as they’re managed properly.
However, if a conflict of interest isn’t appropriately managed, then it could potentially damage the reputation of your organisation and even potentially breach laws in severe cases.
It’s important to remember that a conflict of interest doesn’t just concern the parts of an individual, but also those of immediate family members. This means that employees need todiscloseany private, financial or other interests of any of their immediate family (which includes spouses or partners and children).
Any conflicts can be disclosed by filling out a conflict of interest declaration form and submitting it to your organisation.An example of a Conflict of Interest declaration form used by theCommonwealth Ombudsman.
A conflict of interest declaration is an easy way to ensure that your organisation’sintegrityis maintained and that there is no bias in your decisions. Regardless of the nature of an organisation, integrity must be maintained to ensure trust between the organisation, its customers and society. Furthermore, conflict of interest declarations demonstrates your organisation’s efforts to promote transparency and ensure the way you operate is above board. There are a few different situations that would require an individual to submit a conflict of interest declaration. Here are a few examples: While it’s better to avoid conflicts of interest altogether, this isn’t always possible and means that sometimes the conflict of interest needs to be acknowledged and managed in a way that a third party would be happy with. Each case needs to be assessed individually as the circ*mstances surrounding any conflict of interest will be different. There is a whole range of options for management, but here are some recommended actions: The conflict of interest should be reported if an employee does submit a conflict of interest and it requires a management strategy or if their disclosure could raise concerns about codes of conduct and potential breaches. When in doubt, it’s always best to report any potential conflicts and refer to your own company’s conflict of interest policy. A great example of a conflict of interest policy is theCommonwealth’s Ombudsman’s guidelinesfor APS employees. It’s crucial to maintain transparency and integrity in any organisation. A conflict of interest declaration is necessary to ensure the duties of an individual are carried out appropriately and not to the detriment of a fair outcome. By creating a culture that encourages employees to declare any potential conflicts, you can significantly reduce the risks in your organisation. AtAccurate Background, we are experienced in recommending when a conflict of interest declaration may be necessary.Getin touchto find out when and how this may be applicable for your organisation.Why Do You Need a Conflict of Interest Declaration?
Some Examples of When a Conflict of Interest Declaration Would Be Needed
How to Manage a Conflict of Interest
Steps to Be Taken
How to Minimise Conflict of Interest
Key Takeaways When It Comes to a Conflict of Interest Declaration