Conflicts of interest arise when employees have a private interest in the outcome of a task in which they are engaged in that is possibly antagonistic to the firm's interests and substantial enough that it might affect the employee's independent judgment on the firm's behalf.

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Business

Nathalia Lara

15 March, 18:04

Conflicts of interest arise when employees have a private interest in the outcome of a task in which they are engaged in that is possibly antagonistic to the firm's interests and substantial enough that it might affect the employee's independent judgment on the firm's behalf.

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Aryana Cross · Answer 1

True

Explanation:

Conflict of interests refers to the conflict between organizational interests and personal interests of an individual.

For example, a director has the authority to sanction a project investment with another company. The director knows that such a project if entered into, is not beneficial for the company but since the directors own relative is a director of the other company, such an alliance would personally benefit him.

In such a case, the director is experiencing conflict of interest and during the meeting of the board, he must disclose his personal interest in such a project.

A conflict of interest impairs an individuals judgement and objectivity.