Declarations of interest

A declaration of interest is a formal document in which an individual declares their financial or personal interests that might influence their decisions or actions in a particular role or situation. It helps to ensure that decisions are impartial and not influenced by personal financial interests or other conflicts of interest. In the context of management, declarations of interest can be used to identify potential conflicts of interest and to ensure that decisions are made in the best interests of the company. They can also help to promote good governance and transparency in an organisation by helping to identify any potential areas of bias.

When to use declarations of interest

Declarations of interest are used in a variety of contexts, such as business and management, politics, and public service. They can help ensure that decisions are made objectively and without personal bias or conflict of interest. Declarations of interest can be used in the following contexts:

• In the business and management context, declarations of interest can be used to identify potential conflicts of interest and ensure that decisions are made in the best interests of the company.
• In the political context, declarations of interest can help to promote accountability and transparency by ensuring that elected representatives are not influenced by external interests or financial gain.
• In the public service context, declarations of interest can be used to identify any potential sources of bias and ensure that decisions are made in the best interests of the public.
• In the academic context, declarations of interest can be used to ensure that research is conducted objectively and without bias.
• In the legal context, declarations of interest can be used to ensure that lawyers or judges are not influenced by their own interests or those of their clients.
• In the medical context, declarations of interest can be used to ensure that healthcare professionals are not influenced by financial interests or other conflicts of interest when making decisions.

Types of declarations of interest

Declarations of interest are an important tool for managing potential conflicts of interest and ensuring good governance and transparency in an organisation. They can come in many forms, including:

• Financial Interests: These refer to any financial interests that may influence an individual's decisions or actions, such as stocks, investments, or business holdings.
• Personal Interests: These refer to any personal interests or relationships that may influence an individual's decisions or actions, such as family ties or friendships.
• Professional Interests: These refer to any professional interests or relationships that may influence an individual's decisions or actions, such as consulting or advisory relationships.
• Political Interests: These refer to any political interests or relationships that may influence an individual's decisions or actions, such as affiliations with political parties or campaigns.
• Social Interests: These refer to any social interests or relationships that may influence an individual's decisions or actions, such as membership in a social group or organization.
• Regulatory Interests: These refer to any regulatory interests or relationships that may influence an individual's decisions or actions, such as affiliations with regulatory bodies or agencies.

Advantages of declarations of interest

Declarations of interest are an important tool for promoting transparency and good governance in any organisation. They can help to ensure that decisions are made in the best interests of the company and that any potential conflicts of interest are identified. The advantages of declarations of interest include:

• Improved transparency and accountability: Declarations of interest help to ensure that decisions are made in an open and transparent manner. They can also help to make sure that any potential conflicts of interest are identified, allowing the organisation to make decisions that are in the best interests of the company.
• Increased awareness of personal interests: Declarations of interest can help individuals to become more aware of their own personal interests and how they may influence their decisions. This can help to ensure that decisions are impartial and not influenced by any personal interests.
• Prevention of unethical behaviour: Declarations of interest can help to prevent unethical behaviour, as any potential conflicts of interest can be identified and addressed before any decisions are made. This can help to ensure that the organisation is acting in an ethical and responsible manner.
• Strengthened trust: Declarations of interest can help to strengthen trust in the organisation, as individuals can be confident that decisions are being made in the best interests of the company. This can help to improve relationships between the organisation, its stakeholders and the wider public.

Limitations of declarations of interest

Declarations of interest can be an important tool for promoting good governance and transparency in an organisation, but there are some limitations to consider. These include:

• Lack of enforcement: Declarations of interest are only as effective as the enforcement mechanisms put in place to ensure compliance. Without proper enforcement, the declarations are essentially meaningless.
• Self-reporting: The efficacy of declarations of interest relies on individuals being honest and truthful in their reporting. Unfortunately, individuals may choose not to disclose certain interests or may not be aware of conflicts of interest.
• Bias: Even if interests are properly declared, individuals may still be biased in their decision-making due to their personal interests.
• Potential for abuse: Declarations of interest can be used to manipulate decision-making processes for personal gain.
• Difficulty in assessing interests: It can be difficult to assess the potential impact of an individual’s interests, particularly when these interests are complex or involve multiple parties.

Other approaches related to declarations of interest

A declaration of interest can be just one of several approaches to preventing conflicts of interest in management. Other approaches include:

• Codes of Conduct: These are guidelines outlining the ethical standards of an organisation and how they should be adhered to. They typically include details on conflicts of interest, such as prohibiting managers from having a financial interest in any business they are managing.
• Training and Education: This approach focuses on teaching managers about the importance of avoiding conflicts of interest and how to recognise them. By educating managers, organisations can ensure that they are aware of their obligations and responsibilities and can make decisions accordingly.
• Risk Management: This approach involves implementing policies and procedures to identify and mitigate any potential risks. This includes assessing the potential for conflicts of interest and taking steps to prevent them.

Declarations of interest — recommended articles

Conflict of interest — Need for approval — Ethical decision making — Professional misconduct — Model of corporate governance — General audit — Corporate governance theory — Perception of risk — Moral hazard problems

References

• McCartney, M., Hartman, R. B., Feldman, H., MacDonald, R., Sullivan, F., Heneghan, C., & McCutcheon, C. (2022). How are declarations of interest working? A cross-sectional study in declarations of interest in healthcare practice in Scotland and England in 2020/2021. BMJ open, 12(11), e065365.
• Wang, X., Chen, Y., Yao, L., Zhou, Q., Wu, Q., Estill, J., ... & Norris, S. L. (2018). Reporting of declarations and conflicts of interest in WHO guidelines can be further improved. Journal of clinical epidemiology, 98, 1-8.