ENGR 482 Lecture 13

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End Exam 1 content


Exam on Wednesday will be over Chapters 1, 2, 3, and 6

Conflicts of Interest

Definitions

  1. a conflict between the private interests and the responsibilities of a person in a position of trust (as a government or corporate official)
  2. when pivate interests lead them, or might reasonably be expected to lead them, to make decisions or act in ways that are detrimental to their employer's interests.
  3. when, acting in a professional role, a professional has interests that tend to make the professional's judgement less likely to benefit the client or employer
  4. (legal) The situation in which a public official or fiduciary who, contrary to the obligation exploits to personal benefit

Not an old term; came up in court cases around 1940s and was included in codes by 1970

Note that a conflict of interest is not

  • conflicting interest: (likes playing soccer and football)
  • conflicting obligation: (obligation to public to make it safe but also to employer to make it profitable)

NSPE Fundamental Canons

The following canons may relate to conflicts of interest

1. Hold paramount the safety, health, and welfare of the public.

4. Act … for each employer or client as faithful agents or trustees.

6. Conduct themselves honorably, responsibly, ethically, and lawfully so as to enhance the honor, reputation, and usefulness of the profession.


Under 4 in particular,

  • "Engineers shall disclose all known or potential conflicts of interest that could influence or appear to influence their judgement or the quality of their services"
  • "Engineers shall not accept compensation … from more than one party for services on hte same project, or for services pertaining to the same project, unless the circumstances are fully disclosed and agreed to by all interested parties"
  • "Engineers shall not solicit or accept financial or other valuable consideration, directly or indirectly, from outside agents in connection with the work for which they are responsible."
  • "Engineers in public service as members, advisors, or employees of a governmental or quasi-governmental body or department shall not participate in decisions with respect to services solicited or provided by them or their organizations in private or public engineering practice."
  • "Engineers shall not solicit or accept a contract from a governmental body on which a principal or officer of their organization serves as a member."

Especially on last two points, the language is very strong about not participating in even potential conflicts of interest.

Examples

Engineer Alex is a PE involved in subdivision development in his community when the City Engineer resigns to accept another position.

The City Council offers Alex the position of interim City Engineer on a half-time basis until another City Engineer can be hired.

Intrim Engineer Alex will be expected to review plans he has prepared as well as other plans prepared by Engineer Bob who works for a competing developer.

Should Alex accept the interim position?

Answer: No since he will probably favor his own designs over Bob's.


This time, Alex is in private practice. Contractor X for whom Alex works from time-to-time as a consultant, was asked by a local building inspector to have a foundation that X built inspected by a PE since the foundation had cracks that were visible to the inspector.

Since Alex's firm designed the house foundation, Alex performed the inspection. He determined that the foundation did have some minor surface cracks, but nothing he considered unsafe. In Alex's estimation, the cracks were not unusual for the type of foundation involved.

Was it ethical for Alex to inspect his own firm's work?


Answer: No.


Alex is retained by the tstate to perform certain feasibility studies relating to a possible highway spur. The state is considering the possibility of constructing the highway spur through an area that is adjacent to his own residential community. After learning of the proposed location, he discloses to the state the fact that his property may be affected. The state does not object, so Alex proceeds with his feasibility study and ultimately recommends that the spur be constructed.

Was it ethical for him to perform the feasibility study?

Answer: Maybe. The fact that he's working for the state means that he probably should not even work if he is in a potential conflict of interest. However, the state did not object and kept Alex for the job.


Sally serves voluntarily as the ASME Pressure Vessel Committee (est. to produce technical codes that protect the public from exploding pressure vessels, such as steam boilers). Her employer asks here to reduce the cost of a pressure vessel design by using steel that is 25% thinner that the pressure vessel code requires.

Is this a conflict of interest?

Answer: No. Sally has a primary duty for the safety and welfare of the public.


Types of Conflicts of Interest

  • Actual
  • Potential
  • Apparent

something appears or could be a conflict of interest is frowned upon.

Actual Example

John is purchasing bolts for JayCo. If he purchases the bolts from his own family's company, his stock would increase by 20%.

Potential Example

John is purchasing bolts for JayCo. His fiancee's family has owned a bolt-making company for 100 years. If John marries his fiancee, he stands to gain financially if JayCo purchases the bolts from his fiancee's company.

Apparent Example

John is a purchasing agent for Jayco. His family owns a family. Ten years ago, he had a fight with his family and has not spoken to them since. John no longer owns stock in the company.

Even though it may not be of interest to John, the fact that he is related (or despises his family) may give rise to a conflict of interest.


What to do?

Recognize!

  1. Disclose: "Boss, I want you to know that my family owns a bolt company that will bid on the upcoming procurement."
  2. Recuse: "Boss, please do not assign me to the bolt procurement because I have a conflict of interest. I will be happy to work on other projects."

Manage.


Why does it matter?

  • Engineers hired for expertise
  • Judgement must be reliable
  • Client/employer must trust engineer to make correct, unbiased decisions
  • Actual and potential conflicts of interest can cause biased decisions; apparent can damage trust.