Conflicts of Interest Policy Guidelines
Conflict of Interest (COI) arises when the exercise of a public duty is influenced, or can be seen to be influenced, by a private interest. COI usually arises without fault or fraudulent intent. However, even without improper intentions, COI can have a detrimental effect on organizational performance and reputation. They create a risk for the organization which should be managed, like all other risks. Uganda National Association of Private Schools and Institutions (UNAPSI) is responsible for promoting and setting high standards of conduct across the private schools industry therefore the conduct of its Board is likely to come under close scrutiny.
UNAPSI and its staff are entitled to manage their affairs in privacy, the regulatory nature of the organization must be carried out in an environment, which is free from any suggestion of improper conduct. Those providing information must be confident that it will be properly handled.
These guidelines are therefore necessary to give UNAPSI and its staff a framework within which to deal with conflicts of interest and other incidental matters. The guidelines are intended to protect UNAPSI against any suggestions that regulatory decisions have been influenced by personal interests and that planning decisions of UNAPSI are made relying on information obtained by virtue of their connection with the private schools industry and access to non-public information.
Conflicts of interest (COIs) can arise for employees at all levels of seniority and in every area of work in an organization. They are an inevitable fact of organizational life and they are not in themselves a sign of wrongdoing, but they create risks which should be identified and managed. However, when these risks are not appropriately addressed, organizational performance and reputation can be seriously compromised, and the effects can be significant for the organization and for the individuals concerned.
These guidelines outlines the obligations on members and employees to identify, report, and address conflicts of interest (COIs), and to subject them to ongoing monitoring. The policy also identifies the role of directors to take steps to address risks of COI in relation to their staff.
The conflict of interest policy guidelines includes practical resources to assist members and managers in identifying, managing and monitoring COIs.
Private interests include both financial and non-financial interests, and can include the interests of family members and close friends or associates. They can be positive or negative interests - personal enmity towards someone can be just as relevant as loyalty to them. The public duty of all employees of the organization (both in Service and the retired) and executives of private school councils includes the obligation to perform all duties in accordance with public sector values, which include accountability, integrity and impartiality. A conflict therefore arises if a private interest might undermine an executive’s ability to perform a particular role in accordance with these values, whether or not the outcome of the task or function is affected; an executive’s benevolent intention does not mean that risks of perceived COI can go unaddressed.
While COI can lead to corruption and fraud, it mostly arises innocently and independently of any fraudulent intent and should be managed with this in mind—with transparency, consistency and without favouritism or exception.
COI can be actual, potential or perceived. A potential COI refers to circumstances where it is foreseeable that a COI may arise in future and steps can be taken now to mitigate any risk. A perceived COI arises where a reasonable person might think that an executive could be unduly influenced by a private interest, even if the executive is confident of their own objectivity. It is particularly important for executives s to address risks of perceived COI because they are the most likely to be overlooked or underestimated.
An important consideration when identifying and managing COI is whether reasonable and fair minded people would consider that a private interest is likely to influence the public duty to the extent that it would create a risk for the organization or undermine public sector values. Being able to identify these risks will assist executives in taking appropriate steps to protect the public interest.
Because COI is inherently subjective and personal, individuals can be prone to underestimating or misrepresenting the extent of the influence a private interest might have. It is therefore critical that managers are involved in assisting executives to assess and address risks associated with COI.
Poor management of COI can have a serious effect on the organization, including:
• Poor substantive outcomes arising from decisions in which merit is compromised
• Loss of stakeholder confidence and the erosion of proper processes
• Considerable expense and loss of efficiency to remedy actions which are tainted by undisclosed or improperly managed COI
• Loss of members trust in management
• Loss of public confidence in government.
The purpose of these COI Policy Guidelines is to enable the organization to manage COI risks effectively by identifying:
• the principles which inform the responsible management of COI risks in the organization
• the responsibilities of all organization executives for the management of COI risks
• the steps executives can take to manage COI risks
• key resources available to assist executives to meet their responsibilities for managing COI risks.
The following four principles underpin the organization’s management of risks of COI:
• Protecting the public interest through upholding public sector values
• Supporting transparency and accountability
• Promoting individual responsibility for integrity and impartiality
• Developing an organizational culture which encourages effective management of COI.
All executive officers have a responsibility to avoid any COI that may affect their public duty. Where a conflict is identified, reasonable steps must be taken to address it in order to protect the public interest.
The primary basis for this obligation is the Code of Conduct for the private education Sector, which is binding on all private schools council executives. Other instruments also impose obligations on particular groups within the organization, and this policy gives effect to those obligations.
All organization executives, including members of the private schools council, are responsible for:
• Being aware of their obligations to avoid and address COI
• Continually assessing their private interests and public duties in order and identify whenever they are subject to a COI
• Reporting identified COI to their manager, (or in certain circumstances to the relevant Panel, Committee or Board)
• Assessing the risks related to identified conflicts and taking reasonable steps to address these risks in accordance with organization policy and procedures so that the public interest is protected.
Private Schools Council
Private School Council members who are not executives of the organization (such as parents) are not bound by the Code of Conduct for Private Schools Council Executives. However, they are bound by the Directors’ Code of Conduct and Guidance Notes.
Relevant duties under this Code are to:
• Act with honesty and integrity
• Act in good faith in the best interests of the public entity
• Act fairly and impartially
• Use information appropriately
• Use the position appropriately
• Act in a financially responsible manner
• Exercise due care, diligence and skills
• Comply with the establishing legislation
• Demonstrate leadership and stewardship.
Principals play a role, as executive officers of Private School Councils, in advising Private School Council Executives about appropriate steps they should take to ensure responsible management of risks of COI. Executives should be referred to the principles and processes outlined in this policy for guidance.
In addition, it is recommended that regulation of the Education and Training requires that if a member of the school council or a member of his or her immediate family has any direct COI (including a pecuniary interest) in a subject or matter under discussion at a school council meeting, that member:
• must not be present during the discussion unless invited to do so by the person presiding at the meeting
• must not be present when a vote is taken on the matter
• may be included in the quorum for that meeting.
Obligation to Incorporate COI Management in Specific Circumstances
The management of COI in accordance with the organization policy should be incorporated into the work of the following groups, which are formed in the organization from time to time:
The policy guidelines contain resources which can assist employees in applying the above process to real-world situations. Given the variety of circumstances in which COI may arise, the organization also recognizes that high-level principles or generic examples may be inadequate guidance for resolving COI risks in specific circumstances. For this reason, business units throughout the organization are advised to identify clear expectations for executives about how the COI policy should apply to discrete situations. The resources in the COI guidelines can be adapted for this purpose.
1. Identify a conflict
• Could your private interests (financial and non-financial) unduly influence your public duty?
• Could a conflict be reasonably perceived, even where none exists?
High risks of COI
COI issues can arise in relation to almost any area of work and can affect most, if not all, employees. The following are as are prone to risk and therefore warrant particular attention:
• Recruitment and selection
• Tendering and procurement
• Regulation and grant approval
• Other employment (eg. tutoring, conducting a private business)
• Gifts, benefits, hospitality
• Complaints management and disciplinary investigations
2. Address the risks
Report any conflict to your manager. Then take reasonable steps to mitigate any risks to the public interest which might arise from the conflict of interest. Further management strategies include:
• Registering the private interest with the relevant Committee, Board, or in another open forum for accountability and transparency.
• Restricting your involvement in the public duty
• Recruiting a disinterested third party to oversee part of the public duty (such as accepting a selection panel’s decision in your place)
• Removing yourself from all responsibilities in relation to the public duty
• Relinquishing your private interest (such as selling financial interest)
• Resigning your public office (temporarily or permanently)
• Be aware of their obligations under the organization’s COI policy.
• Continuously assess their private interests and public duties to identify actual, potential or perceived COI
• Report identified COI to their manager/principal. (Disclosing to peers is rarely sufficient).
• Assess the risks of an identified COI and take reasonable steps to protect the public interest
Review the situation periodically and when circumstances change: identify new conflicts and consider whether existing management strategies are still sufficient.
COI may be actual, potential or perceived
Potential COIs are conflicts that may arise in future. For example, if you can foresee that a family member’s company could reasonably be expected to tender for a contract for which you are planning the terms of reference, you have a situation of potential COI which can, and in many cases must, be addressed. Reporting potential COIs as early as possible also often avoids future complications.
Perceived COI are situations where a third party might consider that an employee is subject to an actual COI. For example, when a principal removes herself from a selection panel which selects her spouse for a role in the school, a perception of a conflict might still exist if she does not also remove herself from accepting the panel’s preferred candidate, since all the panel members are her subordinates.