Managing Conflict of Interest - Organisation for Economic Co ...

Learning from Case Studies 77Nations Convention Against Corruption (UNCAC), which it ratifiedin 2006, as well as the parameters and guidelines issued by OECD.However, COI is not defined per se in the prevailing laws and regulationsin Indonesia, except in certain economic laws such as theCapital Market Law and briefly also in the Company Law. At present,there are provisions scattered throughout Indonesian laws andregulations, code of ethics and conduct, official oaths, and otherimplementation and enforcement mechanisms that address COI,including but not limited to the 1945 Constitution, the Public ServicesLaw, the Anti-Corruption Law, the Corruption EradicationCommission Law, the Judiciary Law, the Public Prosecution Law, theSupreme Court Law, and the Legislature Law.Thus, there is no standard definition or consistent understandingof COI in prevailing laws, regulations, and codes of ethics orconduct. However, in almost all of the written rules adopted by differentinstitutions or organizations in Indonesia, the concept of COIincludes restrictions that a public official shall: (i) not intervene ina court proceeding, especially when the official or his or her familymember or a party with which he or she is affiliated is involved;(ii) not issue a policy or decision that will benefit his or her personalinterest or the interest of his or her family member or a party withwhich he or she is affiliated; (iii) not be involved in any structure ofpolitical party or in practical politics; and (iv) not take or assume anyposition in other public functions, private companies, or nonprofitorganizations unless otherwise stated in the prevailing laws andregulations.Remaining ChallengesIn many cases, COIs occur in Indonesia in the absence of clearlaws and policies that would specify what constitutes a COI, orbecause management frameworks and enforcement mechanismsare not in place to help prevent or manage such conflicts. ManyCOIs are not intentional and in many cases not technically illegal.The strong influence of businesspeople in the Cabinet, governmentagencies, Parliament, and other public sectors in the makingof public policies is inevitable. Major companies owned or controlled,directly or indirectly, by high-ranking public officials havewon strategic government contracts. There are fears that stringentregulations on COI could deter potential investment, growth, andADB/OECD Anti-Corruption Initiative for Asia and the Pacific