“The appointment of individuals to positions within the public sector is considered a high-risk area for conflict of interest situations.”
“It isn’t wrong or unethical to have a conflict of interest, what is important is that it is identified and appropriately managed”
The Integrity Coordinating Group
The Integrity Coordinating Group (ICG) was formed to promote and strengthen integrity in Western Australian public authorities. ICG members support integrity through their independent roles under their own legislation, and also work collaboratively across the public sector.
Integrity in decision making
Decision makers need to demonstrate integrity by:
- serving the public interest
- using powers responsibly
- acting with honesty and transparency
- addressing improper conduct.
The Integrity in Decision Making guidelines
ICG supports building the capacity of public authorities, and their employees, to demonstrate integrity when making decisions.
These guidelines provide public authorities with information and practical tools about integrity in decision making, which can be used to stregthen and sustain their decision making processes.
Almost all functions performed in the public sector can potentially lead to conflict of interest situations. A conflict of interest in itself is not necessarily wrong or unethical, however, identifying and managing the situation is important. Managing conflicts of interest is all about risk management. Identifying at-risk functions in the organisation is the first step to managing the risks conflicts of interest present.
The appointment of individuals to positions within the public sector is considered a high-risk area for conflict of interest situations. The Public Sector Management (Breaches of Public Sector Standards) Regulations 2005, Public Sector Management Act 1994 and the Public Sector Commissioner’s Instructions provide guidelines on recruitment, appointment and selection processes but do not specifically address conflicts of interest, how to identify or manage them. In any recruitment process, a conflict of interest (perceived or actual) should be declared and appropriate action taken. Panel members should not be part of a process where they have a conflict of interest, or where there could be a reasonable perception that it exists.
The following scenario illustrates one example of how conflicts of interest may be identified and what strategies may be employed to manage them. The choice of strategies may vary across the sector and will be dependent on the operating environment, legislative requirements and practical solutions.
A large State Government agency with regional departments advertised a vacancy in one of the regions. As Regional Director, Kylie was appointed chair of the selection panel. Two other Regional Directors were panel members.
Kylie’s brother-in-law, Phil, was an applicant for the position. Kylie did not register this as a conflict of interest as her relationship to Phil was well known in the region. She discussed the matter with the other panel members who assured her they were confident she would not let the relationship influence her.
The recruitment process continued and Phil was declared the recommended applicant. A breach of standards claim was lodged by one of the unsuccessful applicants, on the basis that the recommended applicant had been chosen not from a merit-based process, but rather because of nepotism/patronage.
How to identify conflicts of interst
Kylie was in a decision-making position and hence was in a situation of conflict between her family relationship with Phil and her public duty to select the best person to fill the vacancy.
How to manage conflicts of interest
In this situation it was not sufficient for Kylie to declare her relationship to Phil to panel members. She needed to formally register the relationship as a conflict of interest and remove herself from the panel.
- Public Sector Management Act 1994
- Public Sector Management (Breaches of Public Sector Standards) Regulations 2005
- Code of Ethics and Conduct
- The Public Sector Commission Western Australian Public Sector Code of Ethics (reprinted December 2010)
- Agency Codes of Conduct
Policies and Guidelines
- The Public Sector Commission Western Australian Public Sector Standards in Human Resource Management
- The Public Sector Commission Western Australian Questions and answers - HR principles in human resource management
The 6 Ps
Public duty versus private interest
Do I have personal or private interests that may conflict, or be perceived to conflict with my public duty?
Could there be benefits for me now, or in the future, that could cast doubt on my objectivity?
Remember, perception is important. How will my involvement in the decision/action be viewed by others?
Does my involvement in the decision appear fair and reasonable in all the circumstances?
Presence of mind
What are the consequences if I ignore a conflict of interest? What if my involvement was questioned publicly?
Have I made any promises or commitments in relation to the matter? Do I stand to gain or lose from the proposed action/decision?
The 6 Rs
Recording the disclosure of a conflict of interest in a register is an important first step, however this does not necessarily resolve the conflict. It may be necessary to assess the situation and determine whether one or more of the following strategies is also required:
It may be appropriate to restrict your involvement in the matter, for example, refrain from taking part in debate about a specific issue, abstain from voting on decisions, and/or restrict access to information relating to the conflict of interest. If this situation occurs frequently, and an ongoing conflict of interest is likely, other options may need to be considered.
If it is not practical to restrict your involvement, an independent third party may need to be engaged to participate in, oversee, or review the integrity of the decision-making process.
Removal from involvement in the matter altogether is the best option when ad hoc or recruitment strategies are not feasible, or appropriate.
Relinquishing the personal or private interests may be a valid strategy for ensuring there is no conflict with your public duty. This may be the relinquishment of shares, or membership of a club or association.
Resignation may be an option if the conflict of interest cannot be resolved in any other way, particularly where conflicting private interests cannot be relinquished.
Some other titles in this series
Available at www.publicsector.wa.gov.au/icg:
- Managing procurement processes, tenders and contracts
- Sponsorship from the private sector
- Wearing two hats–dual roles as a public officer
- Getting on Board–representative members on Boards and Committees
- Gifts, benefits and hospitality
- Recruitment, selection and appointment
- Secondary employment
Where can I get more information?
More information is available from ICG website at www.publicsector.wa.gov.au/icg
Where can I seek further advice?
It is important to first discuss the situation with a supervisor or senior colleague. You may also contact:
The Public Sector Commission
Governor Stiriling Tower
197 St George's Terrace
PERTH WA 6000
Telephone: (08) 9219 6600
Facsimile: (08) 9219 6001
ICG is grateful for the support of Queensland’s Crime and Misconduct Commission (CMC) and the New South Wales Independent Commission Against Corruption (ICAC), and acknowledges that much of the content developed by CMC/ICAC in Managing Conflicts of Interest in the Public Sector: Toolkit has been adopted by ICG, with some modification and adaptation for the Western Australian environment.
This information does not constitute legal advice and ICG accepts no liability for the accuracy of the information, or for any act or omission done in reliance on the information provided, or for any consequences, whether direct or indirect, of any such act or omission.
© Corruption and Crime Commission, Information Commissioner, Office of the Auditor General, Public Sector Commission, and the Parliamentary Commissioner for Administrative Investigations 2011.