Conflicts of Interest – What Lies Ahead?

The end of the year is as a good time as any to reflect on the past and to speculate about the future – even for COIs.

One of the most important books published  in the past year is Steven Pinker’s The Better Angels of Our Nature, which shows how the incidence of violence has declined dramatically over the course of human history.  It is a highly compelling and in many ways surprising account, and is the best good news story  I can recall.  But, to my knowledge, a similar story could not be told about COIs – at least not yet.

While as not as of ancient vintage as violence, COIs have been with us for a long time.  According to one research paper,  “[a]round 1500 b.c., Gimil-Ninurta — a poor citizen of the city of Nippur in Mesopotamia — tried to enlist the assistance of the mayor of Nippur by offering him a goat. The mayor accepted the goat, but rather than providing assistance ordered that Gimil-Ninurta be beaten.”    In this early episode we see two different attitudes toward COIs – one of rejection, the other not – that seem to have co-existed ever since.

Still, Pinker’s book raises the question (at least to those in the compliance and ethics field): could there ever be a steep decline of COIs worldwide, the way that there has been for violence?

Viewed from a purely economic perspective, the future of COIs might turn out to be darker than the past or present.  That is, the ever increasing complexity of many aspects of modern business seems likely to further enhance the need for individuals and organizations to trust others in making decisions of consequence, which, in turn,  could  make COIs  even more harmful, i.e., it might increase the overall negative impact of COIs.

But there is another way to look at the economic side of the analysis: information-related technologies could make monitoring for conflicts by employees and other agents easier, presumably diminishing the likelihood of COIs overall through both enhanced detection and deterrence. An example of this is disclosure through publicly available data bases of payments by life science companies to health care providers (although, as noted in another post, there is a long way to go with this).

Moreover, developments in the legal and ethical realm may point toward a brighter future regarding conflcts, specifically, the unprecedented attention now being paid to fighting fraud (which is often, but not always, COI-related) and corruption (which inherently involves COIs).   I believe that these twin developments could lead to a greater recognition of the need to prevent or mitigate COIs generally.

I’m not suggesting that this would cause as deep a change as that identified by Pinker.  But it is a start, and perhaps as good a basis for hope as any in the age-old struggle against conflicts of interest.