"Apparent" conflict of interest. Huh?

Factual Questions
1

Recently I’ve been encountering a strange concept: real conflict of interest versus apparent/potential conflict of interest.

Is this totally screwy, or is it just me?

I’d always believed that an apparent conflict of interest WAS a conflict of interest. Period, end of story. If a potential for bias or outright corruption exists, that’s called “conflict of interest” and there’s nothing “apparent” about it.

So, I guess I’m asking what the term “potential conflict of interest” means, and whether the world is starting to conflate it with “potential for bias.”

2

Here’s the distinction made by the National Cancer Institute (NCI)

http://la.cancer.gov/CARRA/ethical2.htm

So, an actual conflict of interest is one where the person making the decision or someone close to him, like a spouse, child, etc, would benefit from his decision.

An apparent conflict of interest is one where no prohibited beneft exists, but it might appear to a resonable person that one does.

3

Here’s a case study from Victoria, Australia, that goes into more detail:

http://www.cpaaustralia.com.au/01_information_centre/11_risk/1_11_5_1_15_conflict.asp

4

But those sites are perfect examples of what I’m talking about! They seem to be re-defining the usual terminology; changing the meaning of “conflict of interest” so instead it means “actual bias occurred, benefits were reaped.” I thought that “conflict of interest” meant “potential for abuse,” not “abuse” itself.

I guess my original question wasn’t clear. Let me restate it.

I was under the impression that there were two general types of event here:

  1. Bias, corruption, abuse. Making money (etc.) because of non-impartial decisions.

  2. POTENTIAL for bias, corruption, abuse. A person is put into a position where he/she might not be impartial… but the person in question tries to combat any leaning towards self-interest, and remains rigidly impartial at a conscious level (but perhaps is subconsciously biased anyhow.)

I thought that number two was the definition of “conflict of interest” and number one was the definition of “actual bias or abuse is occurring.” AM I WRONG? That’s my question to the teeming millions.

Your second link says this:

It was my understanding that the above quote was the very definition of “conflict of interest” itself. What the heck is this “apparent” stuff about? Aren’t they talking about actual abuse, versus conflict of interest? Instead they label them “conflict of interest” versus “apparent conflict of interest.”

5

I think the answers given were pretty clear and specific, and IANAL, but perhaps another specific example will help.

Case One: I’m a school board member. My brother-in-law is applying for an administrative job in that school system. I vote to hire him for this lucrative position. That’s a **real ** conflict of interest, since I might be voting for him not because he’s the best one for the job, but because I want my sister to benefit from his income.

Case Two: Same scenario except I don’t really care one way or the other about either my brother-in-law or my sister. I know he has other offers, and she has a good job, and they will be fine regardless. In fact, I’m not really all that fond of either of them, but would put the best interests of the school district first anyway. If he’s the best candidate, fine, I’ll vote to hire him. That’s **apparent ** conflict of interest. Anyone who simply knew the identities of those involved could reasonably come to the conclusion that I’d vote for my brother-in-law because of the family involvement, whether or not that’s really the case.

In both situations, there’s the **potential ** for conflict of interest.

See the difference?

So regardless of my feelings about my sister or my b-i-l, I should ethically abstain from the decision since there is at **least ** apparent, and possibly actual, conflict of interest.

6

The way I read that, a brother-in-law would fall into the “apparent” case since there’s no “official responsibility” involved. A spouse would be “real”.

7

Replace “official” with “legal” and the distinction of terms makes more sense.

8

No, they won’t.

Please read and understand my messages (and if you have questions about unclear parts, ask my for clarification.) From youre response I conclude that I’ve still failed to communicate my question.

How about this.

Of the two definitions below, which one means “conflict of interest?”

  1. abuse of power (or merely bias) is actually occurring.

  2. only a POTENTIAL for abuse of power (or bias) exists …and whether any actual abuse of power is occuring is not the issue.

9

As I suggested, my take is that both terms refer to potential abuse of power. “Actual conflict of interest” would refer to cases where such an abuse of power would actually be illegal under the law.

10

I’m attempting to interpret someone else’s cites, so I may be wrong, but I understand it as follows.

1 and 2 are conflict of interest. That is, a conflict of interest is where I have to make a decision, supposedly for the benefit of A (eg. my employer), but the decision also affects B (eg. me, my spouse, a friend…). Thus there’s a temptation to cheat and choose for B’s interest, even though I’m supposed to look out for A’s interest. The temptation is the conflict of interest: I have the power to decide, and two separate interests, which may conflict. Whether I actually succumb, or indeed find the two reasons coincide after all, doesn’t make it not a conflict of interest, but may or may not make it some sort of fraud or something.

An APPARENT conflict of interest is something that looks like a conflict of interest but isn’t. Probably I have the power to decide something, and people might think I cared how it affected B, but actually I don’t.

I’m not sure what a POTENTIAL conflict of interest is…

11

No, in both situations there’s the potential for abuse of power.

Does “conflict of interest” mean abuse of power? Or does it only mean that a potential abuse of power is evident?

Note that this thread involves defintions of terms. We all need to choose words very carefully, otherwise we’ll end up in a morass of subtle communication barriers. In trying to talk about various definitions of a certain term, it’s very unwise to assume that the term already has a single definition.

I find some websites which state that “conflict of interest” involves only the temptation, only the potential for abuse of power. Other websites say that “conflict of interest” means that actual power-abuse is going on. Both can’t be right. Analogy: a potential murder is very different than an actual murderer.
OK, how about this.

Dick Cheny and Haliburton. If Cheny is a saint and remains unbiased in any decisions involving Haliburton, can we correctly state that no “conflict of interest” is present? No, not if “conflict of interest” means potential for biased decisions.

12

Since Cheney and Haliburton have no current “official” ties there is no real conflict of interest; however, there sure as h*ll is an apparent conflict of interest.

13

OK

Huh? What the hell is an “actual potential abuse of power?” Putting the word “actual” in front of “conflict of interest” forms a new concept: “actual potential abuse of power.” It’s just silly.

I understand actual abuse of power.

I understand potential abuse of power (also called “conflict of interest,” so I always thought.)

I DON’T understand “potential potential abuse of power” (also called potential conflict of interest.)

I DON’T understand “actual potential abuse of power” (also called actual conflict of interest.)
I’m not trying to obfuscate, I’m trying to point out the devious problems caused by these unclear definitions.

What is a potential potential abuse of power? That’s the part I question.

If “conflict of interest” means “potential abuse of power”, then nobody should be ever talk about “potential conflict of interest.” Why? Because “potential conflict of interest” is screwy, it’s redundant and meaningless, it means “potential potential abuse of power.”

ON THE OTHER HAND, :slight_smile: if the term “conflict of interest” means that an actual abuse of power has already occurred; that the person in question has already made a biased decision which brings him/her some monetary benefits, with nothing “potential” about it… then the term “potential conflict of interest” finally makes some sense. ANd also, in that case conflicts of interest are a very serious matter (they’re a form of crime, of actual power-abuse rather than potential power abuse.)

whew.

14

Now that makes perfect sense. And it’s the definition I’d always used in the past.

Bingo!

All kinds of ethics websites discuss “potential conflict of interest.” I suspect that they actually mean “potential for abuse occuring” but they’ve become all twisted up in this semantic problem.

PS
I got going on this topic because over many years I keep hearing politicians say “there is no conflict of interest here, there is only a potential/apparent conflict of interest.”

I suspected that this was a dishonest play on words, where the politician is illegally redefining “conflict of interest” to mean “abuse” and then dishonestly claiming that no possibility of bias exists and that no interests are in conflict.

But after a google search I see that the problem is widespread. People who should know better are replacing the term “abuse” with the term “conflict of interest”, and they saying that since no provable abuse occurred, there cannot have been any conflict of interest.

15

Agreed.

Huh. Nice to know I’m not the one going crazy here. With that many authoritative websites saying screwy things, I end up thinking that I’m the one with the mental problem.
ALso, I see that I was contributing to the confusion. An “apparent conflict of interest” is not meaningless after all. It would correctly mean that a situation looks like there is a potential for abuse, but there’s really no abuse, nor even any temptation of abuse.

If it turned out that everyone was mistaken and Cheny had never worked for Haliburton in the first place, then the whole issue would be an “apparent conflict of interest.”
Still, when I search on the term “apparent conflict of interest”, I find many websites which seem to be improperly using this term to mean “apparent bias and abuse of one’s position.” If there’s good reason to suspect that unconscious bias is present, that’s a genuine conflict of interest, not an “apparent” one.

16

Only a Potential potential conflict of interest? :slight_smile:
Ah, I notice something that’s confusing the issue.

In case 2, the person making the decision THINKS he’s unbiased because of the reasons given. Yet that’s a big problem, since human beings can fool themselves without knowing it. In other words, there can be unconscious processes involved, so the person making the decision might make an extremely biased decision, yet be totally unaware that this is happening.

That’s one reason why conflicts of interest are such a big issue, and why it’s so important to avoid them. In many cases, if it looks like a conflict of interest, it really is a conflict of interest, even if all the parties involved swear up and down that their interests aren’t conflicting.

So, in case #2, is the potential for abuse real? Or is it only an “apparent” potential, a “potential” potential? Nobody knows for certain, even the person making the decision. If abuse could occur unconsciously (a convenient accident,) that’s called “potential for abuse.” Nothing “apparent” about it.

17

This is an interesting thread. I work for a large, NYSE traded company. Every year I have to file a conflict of interest statement. I was co-owner of a brokerage firm when this company hired me. While I went to work for this company, I continued to hold a significant interest in the brokerage firm. This has all been detailed in my conflict of interest statements.

The directors and officers reviewed my statements and found no conflict of interest with my continued use of the brokerage firm in which I owned an interest, because it was demonstrable that no abuse was occurring (I no longer hold said interest). Yes, I made money outside of my company provided compensation off of company generated business, as well as off of competitor generated business. It was OK because there was no abuse - the brokerage company consistently served my employer’s interests as well as or better than any available competitor.

So, it was the best source to use in my company’s, and our shareholders’, best interest. The above situation is what I think of as an apparent conflict of interest.

Dick Cheney and Halliburton have been mentioned in this thread. My ties to the aforementioned brokerage company were a damn sight more concrete than Cheney’s are to Halliburton and the relationship described above was OK, because it was the best deal for my company’s shareholders. If Cheney and Halliburton have severed ties, then his past association with the company may be percieved as an apparent conflict of interest, but if Halliburton is truly the best equipped firm in the bidding pool to deal with the situation, is it a real conflict of interest to award them the contract? I think not.

18

Again, this is exactly the situation that prompted my original question.

Because you’re involved with the brokerage firm, your self-interest is in conflict with that of your employer. You might make a biased decision without even realizing it, since you’ve got unconscious motiviation to protect your own interests. Read carefully: your interests… are in conflict. I always thought that this was called “real, genuine, honest-to-god conflict of interest.” So, no actual abuse is occuring? Yet this has no effect on things, since your interests are in conflict regardless!

It looks to me like the words “conflict of interest” no longer mean “interests are in conflict,” instead the phrase has been redefined. Now it means “provable instances of abuse of power.”

So if there happen to be no instances of abuse, then how can we describe a situation where interests are in conflict and the potential for abuse is ongoing? It’s extremely hard to discuss this situation if the term “conflict of interest” doesn’t mean that interests are in conflict.

19

Epiphany!

I was confused by the mixture of definitions used by authorities in the
matter. I was trying to do as robo99 mentioned and sort out the single
“correct” definition, thinking it was a common legal term.

Wrong!

The authorities apparently don’t define any clear concept called
“conflict of interest.” Instead, each individual website uses its
own definition! Unfortunately the various websites contradict each
other. Some of them define it as corruption and abuse, others define
it as any situation that merely sets up the potential for corruption
and abuse. In other words, there is no such concept as “conflict of
interest.” Nobody agrees on the meaning, therefore there can be
no meaning.

On the other hand, we can probably agree on the meaning of
“corruption,” “abuse of power,” “interest,” “conflict,” etc. It’s
easy to cut through all the confusion and/or outright bulls**tting;
just cross out any instance of the fuzzy phrase “conflict of interest”
and replace it with the full definition being used. All becomes clear.

As long as the phrase “conflict of interest” has no standardized meaning,
the situation is ripe for serious misunderstandings, no?

What if I happen to be a politician who makes decisions affecting an
industry, yet I’m being paid by that industry. Because of the fuzzy
terminology, I can protect my ass and truthfully state that “there is
no conflict of interest here.” I merely have to manipulate my listeners:
I redefine “conflict of interest” not as meaning that interests are
in conflict, but instead as meaning “provable instances of
corruption.” Then I can be as corrupt as I want. As long as I’m
not caught doing it, it means that there was no conflict of interest.

Huh?!!! It’s not lying, since even the Ethics websites have allowed the
meaning of “conflict of interest” to drift in a direction that’s convenient
for corruption.

As for me, I always thought that “pre-existing unconscious leanings”
and “ongoing potential for corruption” are very serious things
which should be stamped out. But instead we’re only supposed to
punish corruption after it has occurred, and not eliminate the
questionable situations beforehand!???

Again the example. If I’m a politician making unbiased decisions involving
an industry, and also I’m being paid by that industry… then my interests
are in conflict. (It doesn’t matter whether the phrase “conflict of interest”
has been given a twisted meaning… my interests are still in conflict!)
In that case I either have to give up the pay, or I have to quit my politician
job. It is NOT enough to have my decisions watched by an ethics
committee. After all, I may be very skilled at getting things past an
ethics committe, yet still be totally biased and corrupted by the pay I’m
receiving. Or I may be honest yet psychologically biased; unconsciously
biased, yet I consciously believe that all my decisions are saintly and
impeccable even though they are not.
See what’s going on here? If we start using the ill-defined term
“conflict of interest” in the above example, then an ethics committee can
fool themselves into tolerating all kinds of situations where hidden abuse
can occur. All they have to do is to define the term “conflict of
interest” as meaning “actual corruption” rather than “potential for
corruption.” If they change the definition in this way, they no longer
take action to halt the potentially corrupt situations. Instead they
pretend that they can catch any instances of actual abuse.

But how does an ethics committee see into the brain of the person
making a decision? How can they eliminate the undetectable bias?
Simple. Just eliminate all questionable situations BEFORE abuse has
occurred. If you don’t like to call this “eliminating conflicts of interest,”
then call it “eliminating questionable situations.” If an unbiased outside
observer thinks that a situation is questionable, then the situation is
truely questionable and not just “apparently” questionable.

Whew. I understand now (and also I’ve burned myself out on this :slight_smile: .)
I’ll shut up now.