How to Make An Effective Conflict of Interest Form

How to Make An Effective Conflict of Interest Form

Written by Risk Management Team on April 18, 2023

Running a business is a never-ending series of decisions, responsibilities, and yes, problems. Managing an organization, with lots of moving parts and even more employees, will never be problem free – that’s just not how life tends to work, unfortunately – but while some issues will arise in your organization no matter what you do, some are avoidable if you play your cards right. 

In the case of any conflicts of interest that may arise for your employees or for your organization, having a clear, comprehensive conflict of interest form could help you head off a lot of issues at the pass. This crucial document helps identify, prevent, and manage situations where an employee’s personal interests could conflict with their professional responsibilities. 

Employees within any company should always be encouraged to be as transparent as possible while disclosing conflicts of interest. Disclosing conflicts is not only essential for maintaining trust and integrity within an organization, but it also helps protect employees and the company from potential harm.

So, before you distribute a conflict of interest form to your employees, you need to know: what information does this document require?

Break Conflicts Up 

When providing a conflict of interest form to provide employees, make sure to break potential conflicts up into different categories, and present those categories to employees, so you get the most detailed information possible on potential conflicts. The main categories of COI tend to be:

  • Financial interests
  • Employment or consultancy
  • Personal or family relationships
  • Gift or favors
  • Use of company information, resources, or intellectual property (IP)

Timing and Duration

Include a place to provide dates of when the potential conflict began, and, if applicable, when it ended. For example, if the conflict in question concerns former employment or consultancy, the employee would include the dates of the job or consultancy in question. Employees should also note whether the conflict is ongoing, or was a one-time occurrence. 

Describe the Conflict

Here’s where you’ll require more detail on the nature of the conflict of interest being disclosed. The information required will be different, depending on what the conflict in question actually is.

Financial Interests

If the conflict being disclosed is a financial one, the employee will need to provide information on the type of financial interest creating the conflict, whether that be bonds, loans, shares, debts, or something else. They should also say, if applicable, the value or size of the financial interest, and the percentage of ownership or control the financial interest represents. They should also provide the name of the organization or company with which this interest lies. 

Employment or Consultancy Interests

For conflicts of interest involving consultancy or employment, the employee filling out the conflict of interest form should give the name and nature of the outside organization – was it a competitor? A supplier? A customer? – as well as what position they held or what service they provided. As noted above, they will need to detail the duration and extent of this relationship and what overlap, if any, exists between the outside organization’s interests and the employee’s role within the company.

Personal or Family Relationship Interests

When a conflict concerns personal relationship or family interests, the employee should begin by disclosing the nature of the relationship, whether that be a partner, a direct family member, or a close friend. They should also give the name of the person who is the source of that potential conflict, as well as any potential influence that person may have on the employee’s decision-making or job performance.

Gifts or Favors Interests

If the potential conflict involves gifts or favors, the employee should describe the nature of the entertainment, gift, or favor received and its estimated value, if possible. They should also provide the name and position of the organization or person providing the entertainment, gift, or favor. Additionally, if possible they should disclose the date of receipt and any other relevant circumstances that might add context or clarification.

Use of Company Resources, Information, or IP

For conflicts that deal with use of company resources, info, or intellectual property, the employee should give a description in which those resources, information or IP have or are being used for personal gain. They should also state the potential impact of this conflict of interest on the company, and any potential benefits gained by the employee. 

Steps Taken to Mitigate or Resolve the Conflict

After giving detailed and actionable information surrounding the nature of a potential conflict, a conflict of interest form should also have a space where the employee can detail actions they have already taken to appropriately address the potential conflict they’ve discussed on the form. Next, they should detail any additional steps they believe should be taken, or at least considered, to further manage the conflict.

ComplianceBridge Helps Manage Conflicts No 

Ensuring that employees effectively disclose conflicts of interest will help your organization avoid a lot of potential…well, conflict. Luckily, ComplianceBridge and its comprehensive, easy-to-use compliance software are here to make creating the ideal conflict of interest form for your business as painless as possible. Our software lets you create custom question sets and schedule recurring periods of disclosure, so you can be sure that no employees slip through the cracks.

Thanks to our automated ComplianceBridge COI software, once you set up disclosure frequency and create your question set, the process basically conducts itself, and our advanced reporting tools let you see how all your employees answer each question, letting you analyze potential conflict disclosure in real time. 

For more information, contact ComplianceBridge today for a free demo!

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