Day 56 – Q 2.Explain the concept of ‘conflict of interest’ in public institutions. How does conflict of interest breed corruption? Illustrate.

2. Explain the concept of ‘conflict of interest’ in public institutions. How does conflict of interest breed corruption? Illustrate. 

सार्वजनिक संस्थानों में ‘हितों के टकराव’ की अवधारणा को समझाइए। हितों के टकराव से भ्रष्टाचार कैसे होता है? उदाहरण देकर स्पष्ट करें।

Introduction:

Conflict of Interest has shaken the today’s world in issue of governance and ethical practices. It refers to a situation in which a person while performing his official duties tries to derive personal benefits through his decision or actions. Usually this issue arises in public and political offices but in present day conditions due to more interactions between public and private enterprises, even private are not untouched.

Body

Public institutions are those which are backed through public funds, controlled by state and is established for public usage. 

Public institutions affected by conflict of interest:

• Appointments: Appointment of personnel’s in public offices that are related to officials.
• Nepotism: Favouring relatives and friends over others especially in terms of appointments, faster clearances of files etc.
• Contracts: Awarding of contracts to known person in exchange for personal favours. Ex: Government contracts to politician son’s company or companies owned by his Benami.
• Policies formulations: Ministers or representatives involved in policy making in those areas where they have substantial interests. Ex: Person owning tobacco manufacturing company takes part in policy making related to tobacco consumption.
• Information: Leaking of information to other persons which might be of personal advantage to him later. Ex: Employee in board meeting leaks information about new contracts to purchase more shares of company for quick gains.
• Post-retirement: This can be observed in Judiciary, In view of post retirement jobs, favouring a party or person in verdicts. Ex: Verdict favouring a particular political party in view of future political appointments post retirement.

Conflict of Interest breeds corruption

• Public procurement: This is a kind of collusive corruption, where both bribe-giver and person in conflict of interest act as partner and rob the society.

• Scams: In judiciary, passing of verdicts in cases where they have substantial dealings. Ex: Judge being partner of company which is involved in cheating.

• Administrative decisions: decision making is rule bound and is supplemented by the discretion of individual officers, which may provide scope for corruption.

• Contracts: Awarding of contracts to known person in exchange for personal favours. This is again a kind of collusive corruption.

Ways to deal with Conflict of Interest:

• Maintaining Transparency in governance: this will act as deterrence against abuse of power.
• Objectivity in governance: this will help him take impartial decisions and also help in establishing behaviour of integrity.
• Maintaining high standards of behavioural integrity.
• Need for legislation to make non-disclosure of conflict of interest punishable.

Conclusion 

In today’s world of interconnectedness, where everybody is connected to every other thing, there will be conflict of interest. But it is the duty of individual to take the path of righteousness and function in manner which is both moral and ethical. Also transparency should be maintained for scrutiny to ensure accountability.