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

178 Managing Conflict of Interestof international or local laws, or to violations of environmental lawsand standards. Such misconduct may also involve nondisclosure ofmaterial information during proposals or negotiations or the breakingof promises or agreements with clients or external partners.Unethical behavior can also be directed inward, violating an organization’svalues, standards of conduct, or minimum requirementsrelating to the treatment of employees.Unethical behavior carries both tangible and intangible risksthat can compromise a company’s reputation and organizationalculture and expose an organization and its board of directors topossible litigation, civil and criminal sanctions, and prosecution.Cultural Challenges of Doing Business in IndonesiaIndonesia’s corporate climate is challenged by a lack of soundregulations, particularly in relation to corporate governance andaccounting standards and practices. There is also inadequate lawenforcement and a pervasive apathy and attitude that “This is theway things are done around here,” which create a comfort zoneresistant to change, exacerbating apathy and heightening frustrationfor those attempting to conduct business.The following three examples of unethical scenarios illustratethe everyday challenges facing Indonesia’s private sector.• A government official, who is also one of your big clients,calls you regarding a vacant position in your company.He asks whether you can help his son in the recruitmentprocess.• A charity foundation owned by one of your shareholdersasks your company to donate to their charity project.Unfortunately, your company has a policy that prohibits youfrom giving donations that are unrelated to the company’sservice area.• You operate an automotive dealer company. In the vehiclevalidation process (e.g., new-vehicle documents, licensing)you are using an agent. Recently you discovered that youragent bribes government officials to obtain the validation.ADB/OECD Anti-Corruption Initiative for Asia and the Pacific