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Conflict of interests 1

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Conflicts of Interest
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Conflict of interests 1

  1. 1. This Photo by Unknown Author is licensed under CC BY-SA-NC -Conflict of Interest -
  2. 2. "Whoever is careless with the truth in small matters cannot be trusted with important matters." – Albert Einstein
  3. 3. Copyleft by Ahmad Rizki Sridadi © 2008 3 For a business to be successful in the long term it has to create value, not only for its shareholders but also for society. We call this Creating Shared Value. It is not philanthropy or an add-on, but a fundamental part of our business strategy. Taken from Alcatel-Lucent CSR Report 2007
  4. 4. • do the right thing— following the law, acting honorably, and treating co-workers with courtesy and respect. This Photo by Unknown Author is licensed under CC BY-NC
  5. 5. • to improve social welfare by ensuring efficiency in the market. With our technology, we strive to spread positive social impact by increasing the earnings of GOJEK partners and ensuring a better standard of living for themselves as well as their families.
  6. 6. Why is it necessary for Morality (Ethics) in Management ? • Moral dilemma; • Fundamental Ambiguity of Human Existence; • Human nature and nature; • Social order. This Photo by Unknown Author is licensed under CC BY-SA-NC
  7. 7. Models of Morality in Management immoral management, moral management, amoral management Carroll (1987,h.8)
  8. 8. Immoral Management • Management whose motives are for self-interest or only for the organization; • Because the goal of management is to gain profits and the success of the company even though it has to violate the law (there is a violation of the law / fraud) • Question: what do I get when I make a decision?
  9. 9. Moral Management • Moral (oriented) management, which rests on ethical norms and professional standards, based on law; • This type of management will not exchange profits with laws and ethical standards, because law is the minimum standard of ethical conduct • Lynn Sharp Paine (1994, 110) calls it "integrity strategy", the conception of ethics as a driving force (driving force) in organizations.
  10. 10. Immoral Management • Immoral management takes two forms: unintentional and intentional. Managers who are accidentally immoral, meaning they are insensitive, have no awareness of the fact that stakeholders suffer losses as a result of their actions. • A manager who is deliberately immoral, means that he takes action only for his personal life, and not for business. Currently most managers are unintentional (Carroll, 1987)
  11. 11. Managers in organizations face ethical issues every day of their working lives This Photo by Unknown Author is licensed under CC BY-NC
  12. 12. Why do managers need to be ethical? • Because society expects managers to put forward ethical norms and at the same time managers can fulfill these expectations if they want to maintain their legitimacy as agents in society (Kidder, 1997). • Against whom?
  13. 13. Definition… • Situation where an individual or the entity for which they work, whether a government, business, media outlet or civil society organisation, is confronted with choosing between the duties and demands of their position and their own private interests. transparency.org
  14. 14. The causes… • Goals are not clearly defined. • Powers and authorities obtained from statutory regulations • Concurrent positions • Affiliate relationship • Gratuities • Weaknesses of organizational systems, • Lack of cooperation / trust (lack of cooperation / trust). • Vested interest • Competition of scarce resources • There are unclear roles / lack of job descriptions
  15. 15. Forms of Conflict of Interest: • Situations that cause someone to receive gratuities or give / receive gifts for a decision / position. • Situation that causes the use of a position / agency for personal / group / group interests. • Situation that causes confidential information of position / agency to be used for personal / group interests. • Concurrent positions in several institutions / agencies / companies that have direct or indirect relations, of the same type or not
  16. 16. • Situations where the authority can provide special access to certain parties, for example in the recruitment of employees without following the proper procedures. • Situations that cause the supervisory process to not follow procedures due to the influence and expectations of the party being supervised. • Situations where there is an opportunity for abuse of office. • A situation in which an official determines the amount of salary / remuneration by himself. • Moonlighting or outside employment (other work outside of the main job). • Situations that allow the use of discretion that abuse power.
  17. 17. Sample Case
  18. 18. • The institution you work for contracts many of the published materials that are printed each month. The three printing companies had already completed the previous printing work with good results and were quite efficient in terms of price. • A close relative of yours recently purchased a printing company. Your job in procurement is to process all tenders for printing contracts. You have access to all the detailed information of the bidding company, in which case your brother who owns the printer asks you to disclose information about the bid price so that he can quote at a lower price. Your institution has also recently launched a major program to cut costs. You know that companies can save you millions of dollars in printing costs over the course of a year if you follow your relative's requests.
  19. 19. Questions : • Does the problem contain a conflict of interest? • Why ? • What is your response and how should the condition be managed properly?
  20. 20. • You are one of the Directors in a pharmaceutical company called "Sehat". You also have a business in the distribution of pharmaceuticals. In this company you serve as a commissioner. These drug distribution companies are often participants in bids for product distribution in “healthy” companies where you are the Board of Directors.
  21. 21. Question: • Does the problem contain a conflict of interest? • Why ? • What is your response and how should the condition be managed properly?
  22. 22. • You are an Inspectorate officer who is authorized to carry out the supervisory function of organizational performance. You are responsible for evaluating operational performance, budget efficiency, and compliance with applicable systems and regulations. • The condition that occurs is that you and your team are often invited to have lunch, receive gifts, and other facilities, as a banquet that is considered normal by every department / agency you come to for supervision. These incidents often happen and the party you supervise is a close friend who often plays golf together and has attended training or education during the early days of employment.
  23. 23. • Does the above problem contain a conflict of interest? • Why do the above problems contain a conflict of interest? • What actions / responses are needed and how should they be taken so that conditions that contain conflicts of interest can be managed properly?
  24. 24. • You work in a government agency that has a main task in the field of infrastructure development. As a project supervisor, you are required to work more often outside the office to oversee the implementation of construction projects that are currently being worked on. Your main task is to supervise the projects carried out according to predetermined plans and costs. As a government employee, your working hours have been determined from 8:00 a.m. to 5:00 p.m. for five working days. • In addition to working in a government agency, it turns out that you also work side by side as a marketing agent (side job) for a property brokerage company. As a marketing agent, you are required to get as many clients as possible who will buy your company's products. For that, you often take advantage of your work time in government agencies to also carry out your side job at the same time. Your boss doesn't know this, because you are often assigned outside the office to oversee projects.
  25. 25. • Does the above problem contain a conflict of interest? • Why do the above problems contain a conflict of interest? • What actions / responses are needed and how should they be taken so that conditions that contain conflicts of interest can be managed properly?
  26. 26. • A driver at an EPC company has a duty to deliver spare parts and equipment to be used in a project that is being worked on. Another task is to deliver and pick up employees assigned by the office. On the sidelines of carrying out his duties, it turned out that the driver was often asked by his superiors to take his in-laws for treatment at the hospital.
  27. 27. • Does the above problem contain a conflict of interest? • Why do the above problems contain a conflict of interest? • What actions / responses are needed and how should they be taken so that conditions that contain conflicts of interest can be managed properly?
  28. 28. • A director in an oil and gas company is given the task and authority to choose a company to be assigned to carry out building maintenance. Because there are still weaknesses in the partner selection system in the company, the director is given the right to take advantage of his discretionary authority to appoint the company in question. It turned out that the director's son worked for a cleaning service and building maintenance service company. Knowing this opportunity, the director's son asked his father to appoint a company where he worked as a building maintenance partner. The son said he had been promised a promotion if his company was appointed as a partner. In selecting a building maintenance partner, the director of the Oil and Gas company did not explain the situation to the board of directors. This is done because he thinks that his actions are in accordance with applicable regulations, and he may make any decisions related to the appointment of a building maintenance partner.
  29. 29. • Does the above problem contain a conflict of interest? • Why do the above problems contain a conflict of interest? • What actions / responses are needed and how should they be taken so that conditions that contain conflicts of interest can be managed properly?
  30. 30. Thank You

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