Self-assessing your COI program
For some companies, it makes sense to do such a targeted/deep dive assessment for conflicts of interest (COIs). This is particularly so for those responding to a significant COI violation or “near miss,” but it is also the case where the likelihood of COI risks is heightened due to geographic, organizational, or industry cultural considerations.
The scope and approach of such assessments for any given company at any given time should vary based on various circumstances. Though, as a general matter, what does one look for in a COI program assessment?
Risk assessment: Has the company assessed COI risk? If so, has it been done in a documented way? Has it used the assessment(s) results in designing and implementing other aspects of the COI program?
Governance: Have the respective COI oversight roles of the board of directors and senior management been formalized? Are there sufficient escalation provisions regarding COIs?
Culture: Are COI rules truly followed, or are there double standards? What is the sense of “organizational justice” vis-Ã -vis COIs?
Policies: Presumably, nearly every business organization has a COI provision in its code of conduct. However, there are also many that need but do not have a standalone policy. Is your company in this category?
Procedures: Are disclosure and related COI procedures clear, easy to use, and well-known? Do those tasked with reviewing COIs have enough knowledge and independence for the job?
Training/other communication: Is there enough training given relevant COI risks (which tend to be high for senior managers/board members and in certain functions, like procurement)? Is training reinforced through other communications—particularly from senior managers?
Auditing and monitoring: Are the COI disclosure practice and other aspects of the program audited? Ask the same question for monitoring (of conditionally approved COIs). Are the audits reviewed by the appropriate person(s)?
Responding to allegations/requests for guidance: Do employees feel comfortable seeking guidance on possible COIs? Are investigations truly independent? Are violations of the COI policy treated with sufficient seriousness? Are lessons learned with sufficient rigor?
Of course, much more could be included in a COI self-assessment but, hopefully, the above will be a helpful foundation.
Source(s):
Self-assessing your COI program. (2022). Bit.ly. https://bit.ly/3HvSGuk