What is a conflict of interest? Solutions to resolve conflicts of interest in the company.

What is the nature of the conflict of interest?

According to the Organization for Economic Co-operation and Development (OECD), the definition of a conflict of interest is stated as follows: “A conflict of interest is a situation in which a public official, within the official jurisdiction of themselves, make or must make decisions, or take actions that may affect their personal interests.”

In essence, a conflict of interest is a process in which one party realizes that its interests are either opposed to, or negatively affected by, another party. A corporate conflict of interest occurs when an individual or organization becomes unreliable due to a conflict between personal interests and professional duties or responsibilities.

Or to be more specific, a conflict of interest occurs when an organization or an individual enjoys a particular interest in the course of work, such as money, status, knowledge, relationship or reputation. students question the fairness of their actions and decisions at work.

How to identify conflicts of interest in the company?

Conflicts of interest can be classified into the following several groups:

- Information abuse: Using the company's experience and business information, providing it, and applying it to third parties at the same time.

- Taking advantage of positions: Putting acquaintances and relatives inside key positions or a list of customers and partners of the company, creating group benefits.

- Abusing relationships: Receiving gifts, buying goods from parties to make business decisions that do not bring benefits or negatively affect the company.

In general, the above behaviors come from the employees' side, which is considered the cause of conflicts of interest in the enterprise. However, workers can be at many levels: from employee, to manager, or even director. The higher the position, the greater the marginal benefits will be received and the more likely the conflict of interest will be.

What are the consequences of conflicts of interest for large enterprises?

Conflicts of interest often stem from personal reasons. In the process of operating an organization, for any position, there will be niche interests that go against the general interests of that organization, the more important the position, the greater the benefits. This urges individuals to make decisions that are not in the interests of the business, thereby harming the organization and the overall goals of the company.

The conflict of interest directly affects the profit and overall development of the entire organization. That means a corporate conflict of interest, when it occurs, is sure to sabotage your organization. A conflict will erode public and internal trust, damage an organization's reputation, damage its finances and, in some cases, even break the law.

Solutions companies need to know when facing conflicts of interest

Conflict of interest in the enterprise, if left for a long time, will be like a slow-exploding bomb, directly and long-term affecting all aspects of the company, from business results, to culture, communication, etc. Therefore, the heads of organizations are the first people who need to correct themselves and put the company on the right track, not to let personal interests harm the collective development.

Identify and point out the seeds of conflict

The company should issue a document that specifies what behaviors are likely to cause a conflict, plus a real-life example, as close to the company as possible, thereby discouraging or regulating prevent as well as sanction sanctions if conflicts arise.

Issue and update company policy on benefits and apply in all cases

Once a conflict of interest policy has been communicated to employees, it must be continually updated to reflect changes in the company's position. Leaders need to cover new cases as well. Continuously updating the policy will show employees the determination to stay away from negativity and towards the collective.

Create a secret communication channel about conflict

Conflict of interest is a serious but sensitive issue and is often not made public to ensure the reputation and credibility of the parties involved. To avoid unnecessary losses, the company should have an anonymous channel to be able to catch up with conflicts of interest taking place from the smallest gaps in its company, while also resolving losses caused by conflicts caused, while ensuring the reputation of the company.

Training employees on conflicts of interest in the company

Employees need to undergo a short training course on this issue, both to raise awareness of conflicts of interest in the business, and to be "reminded" of the consequences for themselves and the company when bringing them up. wrong decisions because of conflicts of interest. Information that should be disseminated includes:

- How does conflict negatively affect the company's business?

- How to exercise good judgment both personally and professionally?

- How to deal with conflicts of interest?

- Discuss conflicts with stakeholders

- How to deal with conflicts of interest in business

When a business arrangement is suspected to lead to a conflict of interest, employees should raise the matter immediately with their manager. Discussing the conflict early allows your company to consider alternatives that will protect the company.

Avoid hiring staff who are family or close friends

This may seem like a personal decision, but in the long run, this policy proves its right. In the labor market with many good people, choosing personnel that can cause group interests and conflicts of interest will be a "sleeve honey" choice, creating opportunities for collusion and wrong decisions.

In addition, if they have "missed" recruiting close employee relationships, leaders may want to consider limiting conflicts of interest that may arise from relationships in the workplace. as opposed to implementing a general ban. As a rule, a spouse or partner should never directly supervise or manage an employee. An employee should not receive feedback from a partner or spouse to evaluate performance.

Conflict of interest in the enterprise is the "rock" that hinders the overall development of the enterprise, therefore, leaders need to soon identify and have policies to prevent and deal with them. conflicts of interest in the enterprise. The longer it takes, this problem will be like a worm, eating away at the "apple" from the inside, rotten the company and it will be difficult to rebuild the company as it was originally.