Conflict of Interest

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Conflict of Interest

A term used to describe the situation in which a public official or fiduciary who, contrary to the obligation and absolute duty to act for the benefit of the public or a designated individual, exploits the relationship for personal benefit, typically pecuniary.

In certain relationships, individuals or the general public place their trust and confidence in someone to act in their best interests. When an individual has the responsibility to represent another person—whether as administrator, attorney, executor, government official, or trustee—a clash between professional obligations and personal interests arises if the individual tries to perform that duty while at the same time trying to achieve personal gain. The appearance of a conflict of interest is present if there is a potential for the personal interests of an individual to clash with fiduciary duties, such as when a client has his or her attorney commence an action against a company in which the attorney is the majority stockholder.

Incompatibility of professional duties and personal interests has led Congress and many state legislatures to enact statutes defining conduct that constitutes a conflict of interest and specifying the sanctions for violations. A member of a profession who has been involved in a conflict of interest might be subject to disciplinary proceedings before the body that granted permission to practice that profession.

Cross-references

Attorney Misconduct; Ethics, Legal.

conflict of interest

n. a situation in which a person has a duty to more than one person or organization, but cannot do justice to the actual or potentially adverse interests of both parties. This includes when an individual's personal interests or concerns are inconsistent with the best for a customer, or when a public official's personal interests are contrary to his/her loyalty to public business. An attorney, an accountant, a business adviser or realtor cannot represent two parties in a dispute and must avoid even the appearance of conflict. He/she may not join with a client in business without making full disclosure of his/her potential conflicts, he/she must avoid commingling funds with the client, and never, never take a position adverse to the customer.

References in periodicals archive ?
If a financial incentive is involved, which is often the case, a financial conflict of interests may be generated.
An example of non-financial conflict of interests affecting psychiatric research is given by the possible conflict between the secondary interest represented by the researcher's allegiance to a given school of thought and the primary interest represented by the progress of science (3).
An example of non-financial conflict of interests affecting psychiatric practice is given by the possible conflict between the secondary interest represented by a psychiatrist's political commitment and the primary interest represented by patients' welfare (3).
Industry sponsorship and financial conflict of interest in the reporting of clinical trials in psychiatry.
A conflict of interest is when one's actual or imputed interest compromises or appears to compromise one's ability to impartially perform one's duty.
NSF requires awardee institutions to have a conflict of interest policy in place for its investigators as described in NSF Grant Policy Manual (GPM) section 510.
NSF will not review a proposal of an institution employing more than 50 people, unless the institution's Authorized Organizational Representative (AOR) signs a conflict of interest certification form.
Although the institution did have an individual designated to review financial disclosures and evaluate conflict of interest issues, no one submitted disclosures, thus violating the requirement that "the Institutional policy must include adequate enforcement mechanisms, and provide for sanctions where appropriate." (GPM [section]510(e)) Furthermore, the timing of required disclosures was prior to the receipt of funds, rather than ensuring "that investigators have provided all required financial disclosures at the time the proposal is submitted to NSF." (GPM [section]510 (c)).

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