Discussion

Determination of whether there is a conflict of interest frequently depends on the degree of influence you have as a professional, and the extent of any potential benefit to you. For example, suppose that a mutual fund you’ve selected for your Individual Retirement Account holds some shares of Xerox Corporation. Can you ethically engage in discussion of the purchase of copy machines for your employer? Several aspects of this situation suggest that this isn’t a serious conflict of interest. Even though a decision by your employer to purchase or lease Xerox equipment would be expected to benefit Xerox and consequently your own retirement fund, the connection is remote and diffuse. You don’t have any controlling interest or significant influence on the management of either the mutual fund or Xerox Corporation. Thus, this situation does not present an actual conflict of interest. If your influence and wealth grow to the level at which your influence and potential return are substantial, however, the possibility of a conflict of interest grows. Politicians or directors of government regulatory agencies often place their assets in blind trusts to avoid conflicts of interest between their political and regulatory duties and the businesses they affect.

Here’s another situation: Suppose your spouse owns a construction company. Can you ethically participate in the selection of a contractor to build your company’s expansion facility? Here, the connection between the decision process and the potential payoff to you is much more obvious. If the contract is awarded to your spouse’s company, the economic impact on your own family could be significant and immediate. At the very least, your associates involved in the selection process should be made aware of your family connection with one of the bidders. Most likely, you should be excluded from the decision process.

Here is another case in which an engineer may be personally affected by his or her professional decision. In this hypothetical case, Engineer A is asked to study and report on a highway project being considered for an area near his home. The study will likely affect the property value of his home and his residential environment, presumably offering easier access to the highway and increasing local traffic and noise. What are the obligations of the engineer? Certainly, reporting the proximity of the project to his home should be an obligation under this Canon. At a minimum, even apparent conflicts should be acknowledged. However, going a bit further, when is the conflict so great that the engineer should decline the assignment?

If you are involved in large public works projects in your own community, they might frequently affect you personally. But we don’t generally expect that only engineers who live elsewhere should work on public projects. In fact, it’s probably better that those who contribute to the decision-making process experience the consequences of their decisions.

There may be situations in which the consequences are more immediate and severe, however. If, for example, a proposed highway would cut across your property, or a proposed landfill would be across the street from your house, you probably should not make the site decision, although your input might be very valuable to local community organizations. As a general rule, if your professional judgment could be significantly affected because of the potential consequences to your personal situation, you should make these circumstances known and remove yourself from decision-making authority.

Contingent fee contracts also provide a potential for a conflict of interest. This is covered in some detail in the discussion of interpretation (d) of Canon 2.