The Procurement Glossary » Conflict of Interest
Conflict of Interest
Compliance & Risk
Definition
A situation where personal interests could improperly influence a procurement decision.
Explanation
Conflicts arise when a buyer has ties to a supplier — financial, family or otherwise. Left unmanaged they undermine fair competition and invite fraud. Policy requires declaration and recusal to keep decisions objective.
Example
A buyer declares that a bidding supplier is owned by a relative and recuses himself from the award.
Related terms
- Supplier Code of Conduct — A statement of the ethical, labour, safety and environmental standards a buyer expects its suppliers to uphold.
- Procurement Fraud — Dishonest activity to gain improperly from the buying process — such as kickbacks, phantom vendors or invoice fraud.
- Procurement Policy — The documented rules governing how purchases must be made — thresholds, approvals, preferred suppliers and ethics.
- Anti-Bribery & Corruption (ABC) — Policies and controls to prevent giving or receiving bribes and other corrupt inducements in the buying process.
Frequently Asked Questions
What is Conflict of Interest?
A situation where personal interests could improperly influence a procurement decision. Conflicts arise when a buyer has ties to a supplier — financial, family or otherwise. Left unmanaged they undermine fair competition and invite fraud. Policy requires declaration and recusal to keep decisions objective.
Can you give an example of Conflict of Interest?
A buyer declares that a bidding supplier is owned by a relative and recuses himself from the award.
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