Fiduciary responsibility can place you in a state of conflict of interest. True or False?
Before you answer the question, let me walk you through what Fiduciary Responsibility and Conflict of Interest means;
What does the term Fiduciary responsibility mean?
Refers refer to a commitment to play a role in the best in interest of another person or organisation. With the entrusted expectations, an organisation expects to benefit from the fiduciary in any capacity required.
What does conflict of interest mean?
Conflict of interest occurs when one’s personal or social interests compromises decision making or action taken in a workplace.
Now let me tell a short story of Stanley, a real estate manager.Stanley is a professional engineer and real estate manager. Because of his skills and achievements, he landed a great job managing and supervising a 5-star real estate leasing company in Nigeria. The pay was good and the role excited him. Stanley was quite the catch for the company as he kept closing deals, secured several partnerships while exceeding all expectations.
They say, “To whom much is given, much is expected” well, let’s say Stanley had to do just more than closing deals. He ensured the office affairs were kept in order and do every supervision needed. A position opened at the 5-star real estate company, and Stanley was to decide who was fit for the role after HR provided a shortlist. Stanley took it upon himself to add a candidate to the shortlist provided. He asked HR that considers Shade his lifelong friend. Shade is quite skilled and, without a doubt, a suitable candidate with all required to fill the position.
The question however is: “Is Stanley meant to recommend someone for the open position or let the HR department do their job while he goes about his duties of supervision and eventual decision?”
As we can see, there are strong reasons why Stanley shouldn’t be recommending anyone for the position. It turned out to be a situation of ‘conflict of interest.’
Effects of conflict of interest
In the first place, managers who place themselves in such a position will be eroding their ability to lead and inspire their subordinates. Leadership demands that the leader’s subordinates trust both the leader’s competence and integrity. Situations of potential conflict of interest reduces trust in the person at the center of the conflict.
In conclusion, whenever you find yourself in a position of power and authority, the best way of dealing with a conflict of interest situation is to avoid it entirely.
So, let me ask you, do you agree that Fiduciary responsibility can place you in a position of conflict of interest?