Conflicts of interest — declare everything to keep everyone safe
I was once accused of not being transparent — quite a shocking moment as ethical behaviour and trust are tremendously important to me in everything I do. The context of this situation was a perceived conflict of interest. Perceived conflicts are virtually impossible to refute without sounding defensive, they are based on rumour or hearsay and sadly sometimes maliciously.
To the malicious point. Another scenario I found myself in more recently was a competitor talking up a conflict I held — in this instance I had been completely transparent and declared all business interests so there was no question of transparency. For that competitor it was advantageous for them to make my tiny shareholding in a business (I have no operational control over) sound like something more major than it was in their attempt to lower my influence. There was nothing I could do without sounding defensive so I “smiled and waved” until the storm blew over.
A lack of transparency results in distrust and a deep sense of insecurity. Dalai Lama
This blog is another older one of mine posted elsewhere with my advice on what to declare and when.
Conflicts real or perceived?
Conflicts are an interesting and complex issue, at a recent board meeting when reviewing our conflicts register we discussed how far we take this — just directorships and shareholdings? or parties with whom we hold contracts in other businesses? other Directors we sit on boards with? our non-business relationships (dearly beloved employers, siblings companies)? It rapidly spiraled into a how-long-is-a-piece-of-string discussion and was resolved by reminding ourselves of our Professional Code of Conduct and need to act in the best interests of the Company AND it’s Investors.
The characteristics of perceived conflicts are a little bit like “The Dress” that viral phenomenon a couple of years back. The Dress was a seemingly irrelevant photo on the internet but quickly became important to some people who had differing perspectives on it’s actual colour. The crazy thing is people asserted their perception (that the dress is actually gold) as “truth” very loudly shouting out the voice of the actual dress owner saying it’s blue and black. I know it’s a stretch but the manifestation is similar:
- your perspective and level of interest determine whether you actually give a sh*t; then
- interpretation of what constitutes a conflict comes in various forums — eg: blue? black? gold?; before
- hearsay becomes the truth - the more a story spreads.
What and when to declare
My personal policy is declare everything and be transparent. I don’t start a conversation with a list or anything like that, rather when the subject moves to a area I hold a conflict in I do this very overt thing — put my hand up and say “just need to let you know I…..”. For example when discussing a challenge with a government customer and the conversation moves to whether NZ owned companies should be considered for a project — I put my hand up and say “Just have to declare I am co-Chair of NZRise a community of NZ Owned companies….” Conflict declared we move on.
Rule of thumb here is — what if the other party found out about your conflict at a later time? how would they react knowing you had not disclosed it? Always err on the side of caution as business relationships can be destroyed over trust, and conflicts (real or perceived) can erode that trust.
Three Tips on how to declare conflicts
Even though I do take this seriously situations like the one I am writing about still arise. When they do having evidence is helpful and also helpfully acts as a means of telling the world what you are up to:
- Ensure Companies Office records are kept up to date for Shareholder and Directorship information
- Keep LinkedIN updated with everything you are involved with — volunteering, advisory, jobs etc
- Err on the side of caution — over communicating what else you are involved with
Things like undisclosed Inter-related companies, companies subcontracting others into engagements to circumvent procurement rules, partnership agreements can all be warning bells in business relationships when discovered.
One of our three values is “Don’t be Dodgy” I work hard to live and breathe this value. My Conflicts are listed on My Context page — for transparency. Vic.
“We live in a great country so helping every New Zealander reach their potential in life is something we can all aspire to achieve”. You can follow me on LinkedIN or on Twitter and read my context here.
This post is my personal opinion so while I wear many hats it doesn’t necessarily reflect the views and positions of the various organisations I represent. Vic