Financial Conflict of Interest and Perception

By Amy Baugh

“I don't have a conflict of interest.”

I hear this statement quite often. You may not have an actual financial conflict of interest. However, you may not be the best judge of whether your personal business interests and institutional responsibilities may appear to be in conflict. Furthermore, your reputation may be vulnerable to attack if you neglect to seek input from a neutral outside source to determine and manage potential conflicts.

Financial conflicts of interest are “situations in which financial considerations may compromise, or have the appearance of compromising, an investigator's professional judgment in conducting or reporting research,” according to the Association of American Universities. “A conflict of interest in research exists when the individual has interests in the outcome of the research that may lead to a personal advantage and that might therefore, in actuality or appearance, compromise the integrity of the research.” (National Academy of Sciences, Integrity in Scientific Research)

“The conflict lies in the situation, not in any behavior or lack of behavior of the individual. That means that a conflict of interest is not intrinsically a bad thing.” (Office of Research Integrity) It is widely accepted that conflict of interest is a natural state of a complex academic career.

The main focus of this article is to discuss the concept of perception. Furthermore, I will stress that because outside parties may question research integrity due to potential conflicts of interest, it is best for outside neutral parties to determine if perceivable conflicts of interest exist. Investigators make themselves vulnerable to allegations of bias if they choose to only self-assess a potential COI.

To define perception, I found this gem:

Perception: The process by which people translate sensory impressions into a coherent and unified view of the world around them. Though necessarily based on incomplete and unverified (or unreliable) information, perception is equated with reality for most practical purposes and guides human behavior in general. http://www.businessdictionary.com/definition/perception.html

Let's start with a fairly benign example of perceptions. My husband owns pointers, a svelte and active breed of hunting dogs. I perceive that they're just skinny, wild and non-cuddly. During hunting season they'll run themselves to death (not kidding) in the pasture if allowed, and it's often difficult to keep weight on them. While introducing a potential animal sitter to the pets, she expressed deep concern that the pointers were malnourished, which is rather amusing, seeing how none of our other pets warrant such concern. Her perception of how voluptuous a dog should be was so different from the pointers' physique that she refused to care for our pets. Perhaps she is accustomed to caring only for pleasantly plump, pampered pets. Needless to say, we were a tad defensive at her claim that we were not properly caring for our beloved, hardworking family members.

Looking at perception more broadly, one might consider the controversy surrounding missing Malaysia Airlines flight MH370. What a tragic story of devastating loss. There is limited evidence of what happened (as far as we know), no survivors are able to give first-hand accounts of the events leading to the disappearance, and the remains have not yet been located. Multiple aviation experts, military leaders, aircraft manufacturers, airline representatives and government agencies from numerous countries have weighed in with theories, satellite images, radar communication, and intelligence, and there are still no definitive answers. It's perceived by some that Malaysia Airlines and the Malaysian government have not handled the situation well, and in the absence of facts and evidence, there are perceptions of mistrust, withholding evidence, sabotage and conspiracy running amok.

Let's get a little more sensitive about the concept of perception. Think about the following people: George Zimmerman, Jerry Sandusky, Oscar Pistorius and Woody Allen. What were your perceptions as you read the names?

The aforementioned individuals are adamant that they are not/were not guilty of their charges. One individual was acquitted, one was convicted, one is currently on trial, and one has never been tried in a court of law. Did their pleas of not guilty change your perceptions of the individuals or incidents? Did acquittal or conviction change your perceptions? The recent interview with Dottie Sandusky, in particular, illustrates how perceptions create realities despite investigations and overwhelming testimony. Thankfully, our justice system, regardless of what we perceive as its strengths and shortcomings, requires that neutral parties (judges and juries) be selected to reach verdicts.

So, how does perception relate to financial conflict of interest? (Note: I am not comparing FCOI to heinous crime!) Conflict of interest is a situation—not a behavior—that is judged, or perceived, by others; it is not determined by the parties directly involved in the situation. Furthermore, regardless of whether one has adequate information, a person will rationalize what he sees and hears to create a reality that shapes his behavior. Perception doesn't require facts, evidence, rational ideas, logical thought or common sense. Therefore, one's perception equals one's reality. Perceptions are facts based on opinions.

If you or your household members have outside personal financial or business interests, ask yourself this: Is there any way that a student, colleague, supervisor, frienemy, taxpayer, organization, business, industry, sponsor, etc., can perceive that my relationship with Entity X could “(1) significantly impair [my] objectivity, or (2) create an unfair competitive advantage for any person or organization?” (The National Academies)

If the answer is “Yes” to either question, you are vulnerable to perceptions of mistrust. Annual financial interest disclosure minimizes your risk, and a financial conflict of interest management plan outlines strategies to maintain a firewall between your outside interests and your institutional responsibilities, including research. Annual disclosure and financial conflict of interest management sends a message to the community that Texas Tech University and its faculty are committed to conducting themselves and their activities in a manner consistent with the highest standards of integrity.

One objective of the Associate Vice President for Research – Integrity, with policy oversight by the faculty-led Investigator Financial Disclosure Committee, is to serve as a neutral outside party and review annual financial disclosure forms to determine whether a manageable financial conflict of interest exists. If a potential conflict exists, an FCOI management plan is created to protect your reputation and avoid unnecessary accusations that might interfere with your primary responsibilities of educating students and scholarly research. Utilizing an FCOI management plan to address a perceived or potential conflict of interest is not an indication that you are engaging in misconduct.

The American Association of Medical Colleges has a great quote about financial conflict of interest that you might want to think about: “The mere appearance of a conflict may be just as serious and potentially damaging as an actual distortion of objectivity. Reports of conflicts based on appearances can undermine public trust in ways that may not be adequately restored, even when mitigating facts of a situation are brought to light. Apparent conflicts, therefore, should be evaluated and managed with the same vigor as known conflicts.”

For more regarding financial interest disclosure or financial conflict of interest topics, contact Amy Baugh, financial disclosure administrator, at (806) 834-2139, or visit the Financial Disclosure website.

Amy Baugh is financial disclosure administrator in the Office of Research & Innovation.