Ministry for Primary Industries
Organisational Guidelines: Conflicts of Interest
Issue Date:
November 2020
1982
Review Date: November 2022
Owner:
Director Human Resources
Act
Overview
Conflicts of interest can arise during the ordinary course of our employment. It is quite normal to have them,
but it is important we know how to identify and manage such conflicts in order to maintain the integrity and
decisions of the affected individual and of MPI.
This guideline presents a framework to help MPI workers and managers deal with conflicts of interest
situations; it wil not provide exhaustive solutions because there are so many potential permutations. It wil
also of er some examples and strategies to assist people in identifying and addressing possible conflicts.
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A conflict of interest declaration should be regarded as a living document. As your situation (personal and /
or work) changes, you wil need to regularly consider any actual, perceived or potential conflicts of interest
that may relate to your work at MPI and have conversations about them. We wil prompt you often, for
example when you start at MPI, if you change roles, or in a Government election year, but we cannot always
be aware of what is happening for you. If in doubt, talk it out with your manager or a Human Resources
Official
representative.
Why do we care about conflicts of interest?
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Conflicts of interest involve ethical considerations and if not properly managed can undermine legitimate
decision making; compromise the development of policy and the delivery of services to the public and
industry; affect the al ocation of public resources; encourage corruption; damage public confidence in the
organisation and / or the State sector as a whole.
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Increased co-operation between the public and private sectors - such as public / private partnerships,
sponsorships, contracting out and self-regulation - has added complexity and increased the potential for
conflicts of interest to arise.
Standards of Integrity and Conduct
As public servants we are obliged to carry out our duties fairly, impartial y, responsibly and honestly. These
minimum standards of integrity and behaviour are outlined in the Public Service Commission Standards of
Integrity and Conduct which applies to everybody who works in the public sector so that:
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The people of New Zealand trust Public Service agencies, and their employees, to be impartial and
responsible when using their powers
New Zealanders are confident that we work in their interest and treat them with fairness and respect
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We act in a spirit of service to New Zealand.
For example, we must:
Ensure our actions are not affected by our personal interests or relationships
Never misuse our position for personal gain
Decline gifts or benefits that place us under any obligation or perceived influence
Avoid work or non-work activities that may harm the reputation of MPI or of the Public Service.
The MPI Code of Conduct further sets out what MPI as an employer expects from its employees and what
employees can expect from MPI consistent with Our Values and expectations.
What are conflicts of interest?
, or have the potential to conflict
with, the responsibilities of their job or position. It means that their independence, objectivity or impartiality
could be cal ed into question, regardless of whether they actual y receive a benefit as a result of the conflict.
.
Conflicts of interest may arise in several ways - through a relationship, activity, strong personal views, family
or community expectations - and it should be identified whether the conflict is actual or may be perceived.
An MPI worker may also be compromised if they receive gifts, invitations or other benefits from a person
who stands to gain from a decision.
Conflicts of interest can be caused by (and are not limited to):
secondary employment
private business interests or involvement (e.g. shareholdings, board memberships, investments,
property ownership, government contracts)
professional or legal obligations or debts owed to someone else
holding another of ice
gifts, benefits and hospitality
strong beliefs or public statements that may indicate predetermination
under the Official Information Act 1982
family or other personal relationships
membership of a club, society or association.
In the case of personal relationships and affiliations, the judgement to disclose these wil typical y depend on
the closeness of the relationship and the degree to whi
s or activities could af ect them.
Guidance from the Office of the Auditor-General notes that a relationship could be
because of the
directness of the link, or because of the degree or strength of association. Simply being acquainted with
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someone, or having worked with them, would not normal y create any problem. A longstanding, close or
very recent association, however, might do.
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Sensitive areas of work
Areas of work that create high risk environments for conflicts of interest include:
interacting regularly with the private sector
contracting and procurement
inspecting, regulating or monitoring of standards, businesses, equipment or premises
carrying out regulatory tests and procedures
issuing qualifications or licences
issuing, or reviewing the issue of, fines or other sanctions
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al ocating grants of public funds, or providing subsidies, financial assistance, concessions or other
relief to those in need
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making determinations or handing down judgement about individuals or disputes
making appointments to positions
fishing activities
participation in coordinated government responses to events of high significance.
Specific instances
An worker must not, without prior disclosure to and approval from their Manager:
accept secondary employment
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be involved in a decision by MPI to recruit, appoint, employ or assess the performance of a relative
or friend
commit MPI to a commercial arrangement with a relative or friend, or an organisation in which the
MPI worker member, a relative or a friend has (or has had) a significant financial, contractual or
employment interest
be involved in policy development or delivering MPI services that could result in a direct financial
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benefit to the staff member, a relative or friend
the
accept a gift in connection with the
of icial role, that may place the worker or MPI under
any obligation or perceived influence; or
participate in or influence a decision to award a contract or other authorisation where the worker is
a friend, relative, or has a contractual relationship with an applicant or tenderer or has had a
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professional relationship with an applicant or tenderer, and has opinions that could reflect bias or
predetermination.
Identifying possible conflicts of interest
The existence of other interests does not necessarily cause a conflict. A conflict occurs where there is a
connection
some other interest or duty that the person has, or
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If there is a risk, or likely perception, of this, there is a possible conflict of interest. It is not relevant whether
the person acts in that way.
Other useful tests to consider are:
Front page of the newspaper. Would exposure withstand external or public scrutiny? Would I be
happy if my interest appeared in the local newspaper? Could it undermine public trust in MPI?
Internal review. Would I be embarrassed if my col eagues or the MPI Director-General became
aware of my interest?
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Some conflict of interest case studies is noted in Appendix 2.
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What to do?
While conflicts of interest should be avoided where possible, there are occasions where a conflict is
unavoidable - particularly in smal er communities and specialist industries, including many of the sectors
MPI operates in. Dif icult judgements may be cal ed for. In these cases, the conflict must be managed
openly and effectively, with adequate measures put in place to support the integrity of the person and MPI.
There are two basic steps:
identifying and declaring the conflict of interest; and
managing (avoiding or mitigating) the conflict.
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Identification and disclosure of a conflict of interest is the responsibility of individual workerManaging the
conflict is primarily a management responsibility. Both steps should be documented to ensure the situation
and decisions are agreed and transparent.
Declaring conflicts of interest
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Al people who are going to work for MPI must complete a conflicts of interest declaration, either as part of
their recruitment process or some other engagement process, e.g. contracting or volunteering. A declaration
wil also need to be completed every Government election year, when a person changes role within MPI,
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and at other appropriate times as requested by MPI.
As soon as an actual, perceived or potential conflict of interest arises, MPI management must be notified. It
is better to err on the side of caution and transparency and raise the issue, even if uncertain or unconcerned
about a possible conflict, before committing to an action that may result in a conflict of interest.
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It is usual y sufficient that the declaration is disclosed
could become) suf iciently critical, the manager should notify their own manager of the conflict and potential
risk. In this event, the conflict may also be notified to the Deputy Director-General of the business unit, and /
or the MPI Director-General.
Al conflict of interest declarations wil be retained in the central register managed by Human Resources.
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Managing conflicts of interest
The manager wil , in consultation with the person who has declared the conflict of interest and, if necessary,
other managers within their directorate and business unit, decide the action(s) required to resolve or
manage the situation.
Each conflict of interest should be considered on a case-by-case basis according to the situation and the
degree of seriousness and sensitivity. Judgement and careful assessment are important.
Considerations should include:
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the type and size of the private interest
the nature or significance of the activity being undertaken by MPI, and the nature and extent
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decision or activity, and the actual (or potential or perceived) impact of this
the practicality and possible consequences of different options for avoiding or mitigating the
conflict, and
whether the situation could undermine public trust in the person or in MPI.
Mechanisms ranging from increased transparency and scrutiny, and declining gifts and hospitality, to
severing connections, should be utilised to prevent potential conflicts of interest arising or to help resolve
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any actual or perceived conflicts that occur.
Where the conflict is remote or insignificant, a formal record of the conflict and a note that no further action
is to be taken may be al that is needed. For more serious cases, further steps are likely to be required.
Withdrawal from, or restrictions on, involvement in the matter are options that can be used.
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Possible management options are listed in Appendix 4.
Managing conflicts of interest the
Most conflicts are expected to be resolved between the person concerned and their manager. One-up
principle. Where the parties are unable to reach
agreement, the final decision rests with the Director-General.
At any time prior to the final decision, the person concerned, their manager or the Director-General may ask
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for an independent review of the situation, guidance and / or recommendations or to assist in resolving
specific conflicts. A review of this nature would ideal y be undertaken by senior members of Human
Resources, Legal Services, Assurance and Evaluation (Professional Standards Unit) or MPI Policy.
Updates
Situations change over time. When a material change occurs or is being considered, the person should
discuss this in a timely manner with their manager / contract manager at the time and record the outcome,
using the declaration process.
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Declarations should also be reviewed from time to time in order to discuss the agreed actions and, if
necessary, update disclosures and their management.
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Confidentiality of records
Conflict of interest records must be held in the HR system and other relevant employment files. Al records
wil be treated confidential
information.
It is important that the confidentiality of conflict of interest information is respected and details are disclosed
only to those that have a legitimate need to know. If there is any doubt, you should discuss the situation with
Human Resources or Legal Services.
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Non-compliance
Non-compliance (failure to declare a conflict of interest or refusal to resolve or properly manage a conflict)
may be regarded as a disciplinary matter (in respect of employees) and action may be taken in accordance
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with the MPI guidelines.
Depending on the circumstances and the seriousness of the breach, action may involve counsel ing and
education, cautions or notice of unsatisfactory performance, through to dismissal and prosecution. Other
actions could include cancel ation of the af ected decisions or contracts, and exclusion of beneficiaries from
future dealings.
Whistleblowing (protected disclosures)
Whistleblowing is rare but may be necessary if you are concerned about a col eague having undisclosed
interests. Such disclosures can be advised to MPI Human Resources or the Professional Standards Unit.
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For protections available under the Protected Disclosures Act 2000, fol ow the process outlined in the MPI
Protected Disclosures procedure.
Final Note
Having a conflict of interest is not necessarily a problem. It is how it is handled that is important.
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Awareness and disclosure are key. If you are uncertain about a situation, please raise it with your manager.
Alternatively, you can contact MPI Human Resources or the Professional Standards Unit to talk through any
questions or concerns.
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It may also be necessary to Speak Up if you are concerned about a col eague having an undisclosed
interest. For more information, go to the Speak Up Policy and Guidelines.
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Appendix 1 - Definitions
Conflict of duty
Where a public sector employee has multiple roles and could be said to wear two hats that is, they
have two of icial roles with a competitive relationship.
Separation of duties is normal y advised.
Conflict of interest
Conflicts of interest arise where two different interests intersect.
affected by some other separate (and usual y private) interest or duty they may have. (OAG,
Managing Conflicts of Interest in the Public Sector, 2005).
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A situation whereby two or more of the interests held by, or entrusted to, a single person or party are
considered incompatible or breach prescribed practice; a situation in which an individual may profit
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personal y from decisions made in his or her official capacity.
(Oxford English Dictionary.)
Non-pecuniary interest
Non-pecuniary interests do not have a financial component but may arise from personal or family
relationships or involvement in sporting, social or cultural activities.
They include any tendency toward favour or prejudice resulting from friendship, animosity or other
personal involvement that could bias your judgement or decisions.
Pecuniary (or financial)
Pecuniary interests involve an actual or potential financial gain or loss.
interest
They may result from the public official or a related party owning property, holding shares or a position
in a company bidding for government work, accepting gifts or hospitality, or receiving an income from a
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second job.
Money does not need to change hands for an interest to be pecuniary.
Perceived (or apparent)
conflict of interest
improperly influence the performance of their duties whether this is the case or not.
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Potential conflict of
A potential conflict of interest arises where a public official has private interests that could conflict with
interest
their official duties in the future.
Private (or personal)
Private interests are those interests that can bring benefits or disadvantages to public officials as
the
interest
individuals, or to others whom public officials wish to benefit or disadvantage.
Private interests are not limited to pecuniary interests or to interests that can bring direct personal gain
or help avoid personal loss; they also include many social and professional activities and interests.
Public interest
A central element of democratic government and administration.
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Acting in the public interest means carrying out official duties for the benefit of the public served by
government, in a fair and unbiased way, and making decisions that are not affected by self-interest,
private affiliations or the likelihood of personal gain or loss.
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Appendix 2 - Conflict of Interest Case Studies
1. Contracting and procurement
MPI has advertised for a firm to supply IT software services. A member of the panel assessing the tenders has shares in one
of the firms which has submitted a bid.
2. Making appointments to positions
A member of the selection panel has a close relationship with one of the applicants for the job.
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3. Secondary employment
A Quarantine Officer, who pre-clears used vehicles in the country of origin and on arrival in New Zealand, also works for a
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private business importing and sel ing used cars. Competitors have complained several times that there may be a conflict, but
no action appears to have been taken.
4. Gifts, benefits and hospitality
A Policy Adviser has been offered an al -expenses paid trip for two to a Pacific Island resort by a major overseas trade
organisation to attend a conference.
5. Fishing activities
At a staff BBQ of the local MPI office large amounts of seafood are consumed, which raises questions about the origin of the
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seafood and how it was obtained.
6. Regulatory approvals
A senior MPI Officer has advised an applicant on how to make their proposed transitional facility comply with MPI rules and
regulations. To assist the process, the Officer also recommended the services of a local firm where a member of their family
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worked. Subsequently, the Officer was responsible for approving the site.
In al of these cases, the private interest could compromise, or reasonably be perceived to compromise, the impartiality and
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decisions of the officer and of MPI. In the last case, the Officer also has a possible conflict of duty.
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Appendix 3 - Conflicts of Interest Declaration Form
MPI Conflicts of Interest & Secondary Employment Declaration
Name:
Position:
Business Unit / Team:
All known or potential conflicts of interest must be declared below. If no conflicts of interest exist, please enter
and complete Secondary Employment Declaration.
Potential conflict of interest
How this might impact on Management actions agreed
Approved (Manager to sign)
(e.g. Financial, Non-Financial,
my work
with my manager
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Conflict of Roles, Predetermination
(personal bias))
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declaration.
the
Secondary Employment
How this might impact on my Management actions agreed with
Approved (Manager
work
my manager
to sign)
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The information provided on this form is, to the best of my knowledge, a ful declaration of any known or possible conflicts of interest I hold with
regard to my position at MPI.
Signed (Employee)
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Signed (Manager)
Date
Completed form to be sent to [email address] by the manager and
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Appendix 4 - Options for managing conflicts of interest
Strategy
Possible action
When most suitable
Register
- decide there is no conflict of interest or very low risk
- for low-risk conflicts of interests and potential
from the conflict
conflicts of interest
To formal y record details of
- arrange additional oversight or review over the
- where the act of transparency through
a conflict of interest
person
disclosing the conflict of interest is suf icient
- inform affected parties that a disclosure has been
made and of the action taken
Restrict
-
- the person can be effectively separated from
setting and decision-making processes
parts of the activity or process
To put restrictions on the
-
- the conflict of interest is not likely to arise
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particularly sensitive or confidential information
frequently
Recruit
- arrange for the affected decision to be made by an
- it is not feasible or desirable to remove the
independent third party
person from the decision-making process
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To use a third party to
- engage in independent third party to oversee or
- in smal or isolated communities where the
oversee part or al of the
review the integrity of the process
rtise is necessary and not easily
process
increase the number of people on decision making
replaced
committees to balance the influence of the person
with the conflict
- seek the views of those likely to be concerned and
ask whether they object to the person being involved
Remove
- remove the person from any involvement in the
- for ongoing serious conflicts of interest, where
matter
ad hoc restrictions or recruitment of others is not
To remove the person from
- remove the person from the situation where they
appropriate
the matter
may stil exert, or be perceived to exert, a covert
influence on the decisions or actions taken
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- re-
a non-conflicting function
- transfer the person to another project or area
Relinquish
- liquidate the private interest
-
- divest or withdrew support from the interest
outweighs their attachment to the private interest
To give up the private
- assign the conflicting interest to a genuinely blind
interest
trust or blind management arrangement for the period
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of the conflict
Resign
- resign from MPI
- no other options are workable
- take extended leave without pay
- the person cannot or wil not relinquish the
To leave the agency
- secondment to another agency during the period of
conflicting private interest and changes to their
the
the conflict
work responsibilities are not feasible
- transfer to another agency
- where this course is preferred as a matter of
- take early retirement
personal principle
Note: al conflicts of interest should be formal y documented together with the management action(s) adopted.
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Appendix 5 - Additional information
MPI policies and guidelines, available on the intranet (Kotahi)
Public Service Commission
Standards of Integrity & Conduct
Understanding the Code of Conduct Guidance for State Servants
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Office of the Controller and Auditor-General
Conflicts of Interest Good Practice Guide
Managing Conflicts of Interest in the Public Sector, presentation by Edrick Child (2005)
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Organisation for Economic Cooperation and Development (OECD)
OECD Guidelines and Country Experiences (2003)
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