Conflicts of Interest - who's responsible to disclose?

Most RFPs have a Conflict of Interest condition, where potential vendors are to voluntarily disclose real AND perceived conflicts of interest. It also gives the buying organization the right to determine if there are any real/perceived conflicts of interest as well.

That being said, who 'checks' this out? There are a couple of situations we've run across over the years that were not disclosed, but luckily were found out before they became issues.

1) A private sector employee started a part-time consulting business from home. The consultant got a project with a crown corporation that ultimately would be involved in bid opportunities from private sector firms, including the one she was employed with (along with its competitors). She didn't see that as a 'conflict of interest' so never disclosed it. It was found out by accident when an email went to the wrong person!

2) A communications firm bidding on an agency of record project had been working as an agent for a group that was lobbying the buying organization. Again, they didn't believe it was a conflict of interest. It was only found out from a mention within one of the resources resumes.

3) A buyer for a public sector organization went for a spa-day with her friend, who happens to work for a supplier to the organization. Although they were friends before the employment situation, and the buyer did not oversee any work of her friend, the friend 'expensed' these spa-days because her friend worked for a client organization. This was found out from the supplier.

So what is a conflict of interest? In simple terms, a person must not be involved in a decision during the course of public duties with the knowledge that there is an opportunity to further the person’s private interests. There must be no apprehension of bias, based on what a reasonable person might perceive.

So why did these people not believe they were in a conflict of interest? They did not believe they were acting in any way to further their personal interests. Whether or not they believe they are working with strict ethical conduct, the other side of the issue is "perceived" conflict of interest. How would competing vendors feel about a competitors' staff member being involved in the procurement process? How would the public feel about a firm working with a lobby group having 'inside information' on the workings of a specific public organization? How would you as a competitor feel about 'spa-days'?

How are you checking for these types of potential issues?

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