The term conflict of interest is used to describe any situation in which the interest of an individual or company interferes with their ability to objectively or impartially participate in a process. Generally, conflicts of interest can fall into one of two categories: actual and perceived.
A conflict of interest can exist whenever one party's interests interfere with their ability to objectively or impartially perform their duties. There does not have to be loss or harm to another party for a conflict of interest to exist. They can be either actual or perceived:
Ethical standards require individuals or companies to promptly disclose conflicts of interest. In addition, ethical conduct prohibits companies and individuals from:
Judicial disqualification, also known as recusal, is an ethical standard within the judicial system. A judge that presides over a matter in a court of law is required to abstain from that proceeding if a conflict of interest exists, or they are unable to participate in a fair and objective manner.