White Paper - Controlling Potential Conflict of Interest

Whitepaper

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Author

Barry Davidow

Bcom, BAcc, MTaxLaw, ACA, CFE, CRMA, PFIIA

Date

2023

Topics Explored

Risk Management, Ethics + Culture

Format

White Paper

Extract/Description

The purpose of this White Paper is to explain the confusion and misconceptions that surrounds potential conflicts of interest, explain why many of the widely used controls are counterproductive and clarify how these conflicts can be effectively controlled.

Key Points

If the process many organisations use for controlling conflicts of interest is not improved, it will continue to cause significant levels of confusion. This leads to poor disclosure and management not only of potential conflicts of interest, but of all types of conflicts of interest.
Potential conflicts of interest are generally poorly controlled because of the significant confusion resulting from:
- Vague definitions
- Bewildering examples
- People having little knowledge of many personal interests that could give rise to potential conflicts of interest
- Unclear instructions about re-disclosure when potential conflicts become real or apparent conflicts of interest
- Potential conflicts being seen as less serious than other types of conflicts of interest.
A separate system for annual declarations of personal interests that leads to misunderstandings.

Relevant Industries

All

Level of Assumed Knowledge

Intermediate

Aligned to Global Internal Audit Standards

No