Conflicts of interest, broadly defined, arise when the personal interests of the employee (or firm) are in conflict with the interests of the company (or client).
For instance, if Transparen's Pricing Manager were to take an active role in a client firm that wished to do business with Transparen, the client might ask that person to provide favorable prices, similar to the prices Transparen paid. This request gives rise to a clear conflict of interest within that person, who wishes both to act correctly with respect to Transparen, which would mean charging prices in line with Transparen's mission and policies, as well as to act correctly with respect to the client, who would of course like to pay as little as possible.
A first position is required by Transparen in the matter of conflicts of interests. In other words, employees and officers of Transparen must, in the event of a conflict, side with Transparen in resolving the conflict. In the event described above, the Pricing Manager must not apply any favorable rules to the client's pricing, except to such an extent as might be applied if there were no pressure from the client.
The first position is necessary because while it is important for everyone to avoid conflicts of interest, it is more important for Transparen to be free of conflicts of interest than for individuals. If Transparen would be in a conflict of interest by the action of an individual who is an employee or officer of Transparen, then the employee or officer must not perform that action, even on personal time and even if through some circumstance the employee or officer is in a position of personal conflict through doing what is right for Transparen.
Transparen owes duties of fairness to both its staff, and to its clients. If prices are artificially lowered for the benefit of one client, then the other clients lose the benefits of Transparen's staff because Transparen may not be able to finance growth if its prices are below market. In addition, clients would not like to know that they are paying more than other clients without a fair reason. A conflict of interest is not a fair reason to inflate the prices for some clients in order to subsidize the prices for other clients.
