A conflict of interest occurs when an individual’s personal life and work responsibilities become one and the same. This occurred with Sharon, whose live-in boyfriend David was the recipient of a seven million-dollar contract from Sharon’s company. The first reason that this situation is a problem is that it appears that Sharon has the authority to award contracts without obtaining authorization from a superior.
Sharon’s opinion is that David’s product is superior and cost-effective. However, it is impossible for her to be unbiased in her opinion as she has a direct interest in David’s success – because they live together, David’s success will improve Sharon’s quality of life and vice-versa.
Sharon has an interest in seeing to it that David succeeds, and as such, will reap the benefits of his success. Next, there is no evidence that Sharon reviewed the offerings from different companies equally. She may believe that David’s product is superior, but it is unclear if she investigated the other products thoroughly. Finally, a company must avoid the appearance of impropriety. Other vendors might discover Sharon’s relationship with David and sue the company for not giving them a fair opportunity to work with them.
The significant other, to whom we will refer as “Whistleblower”, has made every attempt within the confines of his company to report Ken’s illegal activity at work. The supervisors and executives would rather have the income from Ken’s work than to report him to the authorities and risk losing money. Unfortunately, his superiors are short-sighted in that they do not understand the risk they face if Ken is arrested.
People who view kiddie porn online are often monitored by the police and arrested; if they were to find Ken somehow, they would not only arrest Ken but involve his company in any litigation. His superiors have an interest in stopping Ken’s activities before the authorities become involved. However, if they would rather keep the income and face the risk, I would tell Whistleblower that he has two options.
The first is to notify the police about Ken’s activities and be prepared to lose his job. He might want to prepare ahead of time by gathering documents such as positive performance evaluations and evidence that his work meets the standards of quality for his company. By preparing for the worst, he can take action if he is fired. The second option is for Whistleblower to stop trying to bring Ken’s activities to light and to remain quiet about it from now on. It will allow him to keep his job and his reputation.
I interviewed the manager of a popular local restaurant to ask about trade secrets within the company. Do you have any trade secrets? Yes, we have several recipes that were handed down from our owner’s family.
How do you protect your trade secrets? In the past, we were able to keep our recipes secret by not revealing the ingredients. Unfortunately, so many people have food allergies or particular needs that require us to disclose all ingredients in every recipe. Employees are required to sign a confidentiality agreement upon employment. This agreement binds them from revealing the ingredients to a competitor; they are permitted to confirm or deny the ingredients in a particular dish without actually giving the customer a list.
Have there been any leaks of trade secrets? In 2002, a competitor started making lasagna with the same combination of cheeses (two of them rare) that we use. We never did figure out where the leak originated, but there have been no further breaches (that we know of) since.
How do you enforce your confidentiality agreements? We try to foster a friendly, family-like atmosphere in order to discourage employees from becoming disgruntled enough to want to sabotage our business. Employees get paid holidays, substantial breaks, and free meals while on the job.
Let’s say that you have developed a new, unique recipe that you intend to keep secret. How do you introduce it to your employees? The first step is to teach the cooks to make it. I will emphasize to them that the ingredients are to be kept as secret as possible; if they want to keep their jobs, they will ensure that the dish is only available in our restaurant. The next step is to train the wait staff to answer questions regarding the dish without giving away any secrets of its preparation. Finally, we will advertise the new dish in order to bring in more customers.