20 Examples of Conflicts of Interest in the Workplace
What is a Conflict of Interest?
When a situation arises that benefits an employee while affecting your company, it becomes a conflict of interest. And employees are bound through your company’s code of conduct to act in the interests of their employer and not for their own personal gain.
It’s best for employees not to enter into a situation where their actions might create a conflict, whether it’s actual, potential or perceived, without disclosing the information.
So what are some examples of situations your employees might find themselves in?
Examples of Conflicts of Interest
- Hiring an unqualified relative to provide services your company needs.
- Starting a company that provides services similar to your full time employer.
- Failing to disclose that you’re related to a job candidate the company is considering hiring.
- Making arrangements to work for a vendor or client at a future date while continuing to do business with them.
- Posting to social media about your company’s weaknesses.
- Offering paid services on your time off to a company customer or supplier.
- Working part-time at a company that sells a competing product or service as your full-time employer.
- Accepting a payment from another company for information about your employer.
- Failing to investigate a subordinate or coworker’s wrongdoing because they are a friend.
- Sharing confidential information about your employer with a competitor.
- Dating or having a romantic relationship with a supervisor.
- Making a purchase or business choice to boost a business that you have a stake in.
- Accepting a favor or a gift from a client above the amount specified by the company.
- Owning part of a business that sells goods or services to your employer.
- Reporting to a supervisor who is also a close friend or family member.
- Doing business or work for a competitor.
- Accepting consulting fees and providing advice to another company for personal gain.
- Sharing information in an interview about your employer’s activities or plans.
- Taking advantage of information learned on the job for your own benefit.
- Cashing in on a business opportunity that your company might have pursued.
Strategies to Prevent Conflicts of Interest
Unfortunately, employees aren’t always able to recognize these conflicts of interest because many times the situation seems innocent or they don’t realize what’s happening is against the code of conduct.
To teach them what to do when they come across a conflict of interest, there are several different strategies you can use:
Develop Business Standards
Your company should have a code of conduct or employee handbook that addresses conflicts of interest along with other ethical situations an employee might come across. For example, it can address how employees should respond to issues concerning bribery, data protection, confidential information and social media.
Business Ethics Training
Business ethics training covers the exact same messaging as your code of conduct in a different way that helps employees retain the information. With training, you can provide scenarios to employees and help guide them to making the right choice when a conflict of interest arises.
Formal Reporting Procedures
Even if an employee is aware of a conflict of interest, they still need to be encouraged to disclose it to your company. Creating formal reporting policies allows employees to have an open channel of communication where they are able to ask questions.
Employees don’t always recognize conflicts of interest in the workplace. It’s your job to help them identify ethical dilemmas and make the correct decisions. There are several strategies you can use, including business standards, business ethics training and formal reporting procedures.