Which situation represents a conflict of interest?
Correct answer: B. A director awards a contract to a firm owned by a close relative
- A. A manager compares several suppliers using published criteria
- B. A director awards a contract to a firm owned by a close relative
- C. An accountant checks an invoice against an approved purchase order
- D. A supervisor reports a safety hazard to the compliance officer
Explanation
A conflict of interest exists when personal relationships or benefits could influence professional judgment. A contract involving a close relative requires disclosure and proper safeguards.
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About Business Ethics and Corporate Governance
Business ethics applies principles such as honesty, fairness, responsibility and transparency to decisions involving employees, customers, investors, competitors and society. Corporate governance covers the board of directors, accountability, disclosure, internal controls, stakeholder interests, agency conflicts, corporate social responsibility, codes of conduct and whistleblowing.
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