Conflicts of interest in decision-making processes

Stan Kondilios, Partner and specialist in public law, provides a short discussion dealing with conflicts of interest in decision-making processes. This follows Stan’s previous article on reducing corruption and building public confidence in government decision-making processes.

Conflicts of interest in decision-making processes often manifest themselves in two forms – actual or perceived.

Both have an impact on the confidence of the decision-making function of the contributor by those who must abide by that decision made.

This is either because the conflict is actual or perceived. Both are important and both warrant attention by decision-makers to:

• remove the source of the conflict; or
• remove themselves from the decision-making process as a contributor to that process.

Often people find that this particular analysis is difficult to accept, and often that is because they are, in fact, conflicted. This circular discussion is the reason why people charged with a responsibility to make decisions find it difficult to absent themselves from a process.

Often their contribution can bring a benefit, directly or indirectly to someone in their care or to someone they love or someone with whom they have a pecuniary relationship. In other cases, there may be a mutual benefit in an outcome that can arise at the conclusion of a process in some way.

From a governance perspective, people need to be strong and step out of a process and not participate even if it means to their own pecuniary detriment, and especially so if that be the case. This applies whether it be in the public space of government contribution or in a private commercial enterprise where people come together in a common cause  – such as for a charity organisation or a professional services organisation.

When people step out of a process in this way, they ensure they are not put into a position of conflict. They are removing themselves from a situation where the people’s contribution could be perceived as conflicted owing to private or personal relationships or pecuniary interest – in real or potential terms.