Values and Ethics Code for the Public Service

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Chapter 2: Conflict of interest measures

This section of the guide deals with questions related to the Values and Ethics Code for the Public Service, Chapter 2 Conflict of Interest measures by presenting situation scenarios that public servants could potentially encounter.

Case No. 1: Leave of absence

Denise was director of the Pesticides Office, an EX minus 1 position. The office is responsible for approving the marketing of new pesticides, after ensuring their safety and effectiveness. The office also develops federal government policies in this field.

A little more than a year ago, she took a two-year leave without pay. Under the agreement she signed, if Denise decided to return to the department, she could apply for any available position and her application would be given priority. However, she would not be automatically entitled to her previous position, which is now occupied on a permanent basis by someone else.

Since taking leave without pay, Denise has been teaching environmental sciences at a recognized university and working as a consultant. She has no intention of seeking a position in government.

A private sector company has hired her to prepare a request for approval of a new pesticide. An environmental group has hired her to prepare a scientific document intended to convince the government to adopt regulations favouring biological pesticides.

Would Denise be in a conflict of interest situation under the Values and Ethics Code for the Public Service?

Factors to consider

• Could her role, which consists of preparing a request for approval of a new pesticide and writing a scientific document, result in a real, potential or apparent conflict with her official duties?
• Would there be inappropriate use of resources, influence or insider information obtained as a result of her Public Service position?
• Could a third party raise a reasonable doubt about her neutrality or objectivity as a public servant?

References

Values and Ethics Code for the Public Service.

• Chapter 1: Ethical values
  Public servants shall act at all times in a manner that will bear the closest public scrutiny; an obligation that is not fully discharged by simply acting within the law.
• Chapter 2: Public servants also have the following specific duties
  • They should not have private interests, other than those permitted pursuant to these measures, that would be affected particularly or significantly by government actions in which they participate.
  • They must not knowingly take advantage of, or benefit from, information that is obtained in the course of their official duties and responsibilities and that is not generally available to the public.
• Chapter 3: Limitation period:Former public servants shall not, within a period of one year after leaving office
  • accept appointment to a board of directors of, or employment with, entities with which they personally, or through their subordinates, had significant official dealings during the period of one year immediately prior to the termination of their service;
  • make representations for, or on behalf of, persons to any department or organization with which they personally, or through their subordinates, had significant official dealings during the period of one year immediately prior to the termination of their service; or
  • give advice to their clients using information that is not available to the public concerning the programs or policies of the departments or organizations with which they were employed or with which they had a direct and substantial relationship.

Suggested solutions

Denise is in fact subject to the provisions of the Values and Ethics Code for the Public Service. A public servant on leave without pay remains a public servant of the Public Service until the employment is terminated. If Denise decided to resign from her position in the Public Service, the Post-Employment section of the Code would continue to apply to her since Denise was an EX minus 1 public servant. She would have to wait one full year after her resignation to work for a private sector organization that has dealings with her previous office unless the Deputy Head granted her a reduction or exemption from this one year limitation period.

There is sufficient appearance of conflict of interest in this scenario to justify the submission of a confidential report, that would be carefully reviewed based on the factors noted above. Failure to report these outside activities and/or failure to withdraw from those activities could lead to disciplinary measures such as verbal or written reprimands, suspension without pay or even termination.

Case No. 2: publication of a manuscript

In his free time, a public servant writes a manuscript on public policy. The public servant's duties within the Public Service do not include writing for publication. The document proposes different steps to follow and various ways in which an individual, an interest group or a private company could influence legislation or government policy.

The public servant has now been approached by a company interested in publishing the manuscript. Not knowing whether he should accept the company's offer, the public servant submits a confidential report to the designated authority asking for approval to publish his manuscript.

Factors to consider:

• What is the content of the manuscript?
• Does the document contain protected information?
• Does the document deal with the specific business of the department, or is it more general in nature?
• Does the document contradict a departmental position?
• Does the document contain a disclaimer stating that while the author is a public servant of the department, the opinions expressed do not represent the position of the department?
• Was the manuscript written at the workplace, using office resources and during office hours?

References

Values and Ethics Code for the Public Service

• Chapter 1: ethical values
  Public servants shall act at all times in a manner that will bear the closest public scrutiny; an obligation that is not fully discharged by simply acting within the law.
• Chapter 2: public servants also have the following specific duties
  They should not knowingly take advantage of, or benefit from, information that is obtained in the course of their official duties and that is not generally available to the public.

Suggested solution(s)

The resolution of this scenario rests in large part on the answers to the questions raised above. The document would be more likely to receive approval for publication if it is more general in nature, if it does not contradict departmental positions, does not contain protected information, does contain the required disclaimer and was written during the public servant's free time, without use of office resources.

Chapter 2: Gifts, hospitality and other benefits

Case No.1: free stuff

In what circumstances is it permissible to accept a lunch or dinner, or to accept hockey or theatre tickets from an organization that has an interest in doing business with the government? Suppose the occasion is an opportunity to establish better communication and promote understanding between government and the organization? What if the occasion is a seminar that provides useful information to the government? What if it is a purely social event to which your spouse has also been invited?

Factors to consider

• What is the reason for this free stuff?
• What is your current, past or future relation with the company or organization?
• Are you in a position to influence any government decision concerning this company or organization?
• Is the occasion part of a general promotion or have the beneficiaries been chosen according to certain criteria?
• How would your colleagues or persons outside government react if they knew about this free stuff?
• Will your integrity or objectivity be compromised, or appear to be compromised, if you accept this gift or attend such an event?
• Is there the likelihood of an apparent or potential conflict of interest, even if there is no real conflict of interest?

References

• Values and Ethics Code for the Public Service

  The Code states that it is not permitted to accept gifts, hospitality or other benefits that could influence the judgment and performance of public servants in the exercise of their duties (Chapter 2: Public servants also have the following specific duties b) They should not solicit or accept transfers of economic benefit.) The Values and Ethics Code for the Public Service clearly establishes that any unauthorized gift, hospitality or other benefit should be reported to the designated official.

  However, the Code provides that the Deputy Head may approve acceptance of a gift, on a case-by-case basis, if it is decided that the benefits to the organization outweigh the possible appearance of a conflict of interest.

• Section 121(1)(c) of Criminal Code of Canada

  Section 121(1) (c) of the Criminal Code of Canada clearly states that, Every one commits an offence who, being an official or public servant of the government, demands, accepts or offers or agrees to accept from a person who has dealings with the government a commission, reward, advantage or benefit of any kind directly or indirectly, by himself or through a member of his family or through any one for his benefit, unless he has the consent in writing of the Head of the branch of government that employs him or of which he is an official, the proof of which lies on him.

What does this mean?

Each case must be evaluated individually. Factors to be taken into consideration include:

• The reason for the gift or hospitality.
• Potential for possible interaction ? future involvement in matters.
• Public servant's influence in ensuring later business opportunities.
• Donor's expectations.
• Public perception.
• Image of the government/department.
• Roles and responsibilities of the public servant receiving the benefit.

Suggested solution(s):

• Depending on the reason for the invitation, alternatives that could produce the same result should be explored. For example: discussion between two people could help to promote communication and understanding; take part in the seminar portion of the event and decline a meal or hockey ticket.
• The fact of buying one's own ticket or paying the cost of a game of golf does not eliminate the issue of public perception that you are present as a representative of the government and that the company has paid for your attendance, hence an apparent conflict of interest.
• Where possible, your supervisor must be informed in advance of the situation.

Note: a federal government manager may find that he or she is required to take part in events or meals organized by a local chamber of commerce as part of government efforts to increase the manager's community involvement and to develop knowledge and awareness of the community. However, the same manager could be placed in a potential conflict of interest if a single company organized the event or meal. When in doubt, say No

Case No. 2: token of appreciation

You receive a thank you gift from a client, consultant, business or hotel that you have recently done business with. The gift might be a box of chocolates, flowers, a bottle of wine or tickets to the theatre. What should you do?

Factors to consider

• What was the business relationship with the organization in question?
• What is the potential for future work?
• Is the gift a normal expression of courtesy?
• What would a third party think if they knew that you had accepted this gift?
• Can the gift be returned?
• What would be the impact on future relations between the federal government and the donor if the gift were returned?
• Do you believe your integrity and professionalism would be jeopardized if you accepted the gift?

References

• Values and Ethics Code for the Public Service
• Section 121(1)(c) of Criminal Code of Canada

Suggested solution(s)

• Decline the gift. Contact the donor, explain the reasons for your decision and return the gift.
• Accept the gift, but fill out a confidential report to inform management of the situation. The Deputy Head will advise you on steps to take.

NOTE: You should discuss this matter with your supervisor or the designated conflict of interest administrator if you have the slightest doubt about the propriety of accepting a gift.

Case No. 3: conference gifts and prizes>

You are asked to take part in a conference as a government representative. Without your knowledge, the names of participants are entered in a draw. You win. The prize is a suitcase valued at $150. What should you do? What if the prize was computer software worth $750? What should you do? Would it make a difference if you had bought a ticket in a conference draw?

OR

Your department asks you to make a presentation at a conference. The presentation is made to a group of private companies and deals with the government's new partnership initiatives. The government is seeking financial support for the initiative from this industry. As a gesture of thanks, the conference organizers present you with a valuable book. What should you do? What if the gift was a painting by a famous Canadian artist, with a value of $1,000?

Factors to consider

• What will be the public perception if you accept the gift / draw prize?
• What will be the public perception if you refuse the gift / draw prize?
• Is the gift a normal gesture of thanks?
• What would be the repercussions of your decision on future relations with this organization?
• What would be the repercussions of your decision on government programs?
• In what way does this affect your personal integrity or your credibility?
• Should the value of the gift be taken into account?

References

• Values and Ethics Code for the Public Service
• Section 121(1)(c) of Criminal Code of Canada

Suggested solution(s)

In these situations, you have to exercise judgment. In the case of the conference presentation, one could imagine, in advance, that you would receive some token of appreciation. The department's position on this question could have been raised with your immediate supervisor. At the time the invitation was accepted, it could have been established that departmental and personal values and policies would not allow acceptance of any gift or token of appreciation for such an event. Depending on the circumstance, it probably would be difficult to refuse the gift at the conference. However, it could be returned to the organizers with a note of thanks that explained your position.

If you cannot return the gift, then you should fill out a Confidential Report to inform management of the situation. Only the Deputy Head can make a decision on the acceptance of gifts that are worth more that minimal value. Following a decision in the affirmative, the Deputy Head may decide to have the gift placed in the waiting room or similar location, where all could enjoy it. A book could be offered to the departmental library. Most departments have a display case for gifts presented to their public servants. The gift could also be sent to a departmental organization or to an approved charitable organization such as the United Way.

In the situation where you win an attendance prize, the following options can be considered. Depending on the context, it might be possible to politely and diplomatically decline the prize and ask that another name be drawn. Since an attendance prize is not directly related to your government position, there is less risk that this situation would be seen as a conflict of interest.

If you buy a ticket with your own money, the appearance of a conflict of interest may be reduced since the win depended solely on your purchase and is not a direct result of your official duties. However, it could be alleged that the only reason you were able to buy a ticket was that the federal government had paid for you to attend the conference, hence a potential conflict of interest situation.

Here again, if you are in doubt, refuse the prize, and if you do accept, make an immediate report to your supervisor or to the designated official when you return to your office.

Chapter 2: Avoidance of preferential treatment

Case No.1: helping a friend

You are a public servant in the finance section of a department. You work in the revenue section and your job is to reconcile accounts receivable. As part of your work, you have access to the department's main administrative system where information on all departmental files is stored. You are not personally in a position to influence any current file.

You receive a call from a friend, who is a human resources officer for a local small business in the high technology sector. He tells you that his company is trying to sponsor the immigration of a foreign worker for a particular job, but that have not had any news about the case for some time. He adds that his boss is putting pressure on him to find out about the application and he asks you if it is possible for you to check the file in the system and keep him informed about any developments. You know that he won't tell anyone else and there is little chance you will be caught. Moreover, you have no influence at your level, so what harm is there? What would you do?

Factors to consider

• Are you able to give information to your friend through other than normal channels?
• Are you in a position to give him better service than a member of the general public would receive in the standard way?
• Should you disclose personal information concerning a departmental file to a third party?
• Are you in a position to know whether the foreign applicant has consented to have information about him or her disclosed to a third party?

References

Values and Ethics Code for the Public Service

Chapter 2: preferential treatment
Public servants should not offer any assistance to entities and persons that have dealings with the government, where this assistance is not part of their official duties, without obtaining prior authorization from their designated superior and complying with the conditions for that authorization.

Access to Information Act , section 19.

19. (1) Subject to subsection (2), the head of a government institution shall refuse to disclose any record requested under this Act that contains personal information as defined in section 3 of the Privacy Act.

(2) The head of a government institution may disclose any record requested under this Act that contains personal information if (a) the individual to whom it relates consents to the disclosure; (b) the information is publicly available; or (c) the disclosure is in accordance with section 8 of the Privacy Act.

Suggested solution(s)

• Tell your friend that it would not be appropriate for you to do as he asks but that you will find out what are the normal channels to follow, such as obtaining the telephone number for the public call centre or any other information document that could help him to find relevant information (brochure, Internet site).
• You should not offer to contact a third party in his name. Instead, you should inform the person concerned how to obtain the required information.

Case No. 2: real or apparent conflict of interest

You are a finance officer in a medium-sized government department. Your job involves examining applications for funding of projects received by mail, to verify that they are complete, that they meet program criteria, and passing them on to the next level for review. Applications are distributed to officers at random by the mailroom. By chance, you receive an application from a personal friend. The proposed project seems very profitable for the program and its objectives. What should you do?

Factors to consider

• Does the fact that you know the applicant place you in a real or apparent conflict of interest?
• Is an apparent conflict of interest less serious than a real conflict of interest?

References

Values and Ethics Code for the Public Service

• Chapter 1: ethical values
  Public servants shall perform their duties and arrange their private affairs so that public confidence and trust in the integrity, objectivity and impartiality of government are conserved and enhanced.
• Chapter 2: public servants have the following specific duties
  • In carrying out their official duties, public servants should arrange their private affairs in a manner that will prevent real, apparent or potential conflicts of interest from arising.
  • If a conflict does arise between the private interests and the official duties of a public servant, the conflict should be resolved in favour of the public interest.

Suggested solution(s)

• The fact that you know the applicant places you in a potential or apparent conflict of interest. Before proceeding further, inform your manager immediately and ask that the file be assigned to another person.

Case No. 3: privileged information

You are the manager of an office responsible for enforcing regulations that prohibit social assistance fraud by recipients. Your office has a team of investigators who deal with these cases and, when necessary, bring criminal charges against recipients accused of fraud.

Because of a backlog of information in your tracking system, you have hired a number of public servants for a determined period. One of your investigators informs you that one of the term public servants has given him the address of a recipient who is under investigation. When you ask how and why she revealed this information, the investigator tells you the woman was romantically involved with the recipient and discovered he was married. Because she was angry, the woman looked through the tracking system to see whether a file had been opened on the man, intending to cause him some harm. She knew his current address and gave it to the investigator. As manager, what should you do?

Factors to consider

• Did the public servant act improperly by using information that is not available to the public?
• Did the public servant act improperly by using her access to the tracking system for personal reasons?

References

Values and Ethics Code for the Public Service

• Chapter 1: professional values
  Public servants should also strive to ensure that the value of transparency in government is upheld while respecting their duties of confidentiality under the law.
• Chapter 2: public servants also have the following specific duties
  They should not knowingly take advantage of, or benefit from, information that is obtained in the course of their official duties and that is not generally available to the public.

Suggested solution(s)

• The public servant has made improper use of her access to the tracking system for personal reasons.
• As manager, you should investigate the public servant's failure to adhere to the Code, consult departmental directives and take appropriate disciplinary action.
• However, the investigator has a responsibility to act on any information received, regardless of its source. He should act on the information concerning the recipient and conduct his investigation in the usual manner.

Case No 4: outside activities

You are a project officer in the regional office of a department responsible for community development programs. Your work consists in helping volunteer organizations to prepare grant submissions for projects that meet the objectives of your program. You are the only program officer for the region. Moreover, your office is located in a medium-sized city where the business community is closely inter-connected.

Your manager has decided to offer your clients training in finance and project management, and has decided to issue a request for proposals (RFP) to the local financial community for consultants to give the training. Your name is listed on the RFP as the contact for more information. Your cousin, who is an accountant, asks you for help in preparing his bid. Your cousin is also the person who helps you with any construction projects around your house. He is an honest worker, who is dependable and who respects his commitments. As far as you know, no one in your office is aware of this, or of his relationship to you.

Two other competitors from the community submit bids for the same contract. One of them is the brother-in-law of the local Member of Parliament. The other is a person whom you know was previously awarded a contract that had to be cancelled because of a lack of staff at the time of the project.

The awarding of this contract is a real minefield for you, your family and your manager. Public perception of accountability, fairness and transparency is a real issue. What should you do?

Factors to consider

• Even though you have no responsibility for making decisions in this process for awarding contracts, what are your objectives in this situation?
• Should you give any information to your cousin to help him with the request for proposals?
• What should you tell your manager about your relation to one of the bidders?
• What information should you give your manager about your knowledge of the bidders?
• Should your cousin be disqualified from bidding because he is related to you?

References

• Values and Ethics Code for the Public Service
• Chapter 2: avoidance of preferential treatment When making decisions that will result in a financial award to an external party, public servants shall not grant preferential treatment or assistance to family or friends. Public servants should not offer any assistance to entities or persons that have dealings with the government, where this assistance is not part of their official duties, without obtaining prior authorization from their designated superior and complying with the conditions for that authorization.
• The Contracting Policy of the Government of Canada, section 2 "Government contracting shall be conducted in a manner that will withstand the test of public scrutiny in matters of prudence and probity, facilitate access, encourage competition, and reflect fairness in the spending of public funds"

Suggested solution(s)

• Your objective in this situation is to support an open and transparent contracting process that gives equal access to contracting opportunities for each bidder.
• You should inform your manager of your relationship to one of the bidders and ask to be excluded from any further phase of the contracting process.
• Since openness and transparency are essential elements in this case, you should tell your manager and colleagues what you know about the file in a fair and objective manner. The manager should verify all information received and confirm it with other sources.
• Your cousin has the same rights as all other bidders in this process and has the same right of access to any pertinent information available to the public that could help him in preparing his proposal. You should not give him preferential treatment, but you have an obligation to provide him with the same information that is available to any other bidder. As much as possible, your cousin should deal with your manager.
• Your cousin should not be disqualified from bidding simply because he is related to you.

Chapter 2: divestment of assets

Case No. 1: insider information

You work in the finance section at a remote regional office of a science-oriented department. Your department, along with other federal departments, is taking part in the environmental assessment of a local site that could be developed by a company for its natural resources. You have heard that the company recently bought the site and there is a good possibility for high profits.

You are interested in buying shares in the company.

Since you are not involved in the environmental assessment, would buying the company's shares cause a problem? Suppose you had access to information about the results of the environmental assessment soon to be released, allowing development of the site. Would that make a difference? What should you do?

Factors to consider

• Are you in a position to obtain information that is not available to the public?
• How would your purchase of shares be seen by the public?
• Could the integrity of the federal government be cast in doubt?

References

Values and Ethics Code for the Public Service.

• Chapter 1: ethical values
  Public servants shall perform their duties, and arrange their private affairs so that public confidence and trust in the integrity, objectivity and impartiality of government are conserved and enhanced.
• Chapter 2: public servants have the following overall responsibilities
  • In carrying out their official duties, public servants should arrange their private affairs in a manner that will prevent real, apparent or potential conflicts of interest from arising.
  • If a conflict does arise between the private interests and the official duties of a public servant, the conflict should be resolved in favour of the public interest.
• Chapter 2: public servants also have the following specific duties
  They should not knowingly take advantage of, or benefit from information that is obtained in the course of their official duties and responsibilities and that is not generally available to the public.

Appendix A: assets and liabilities subject to a confidential report

The types of assets and liabilities that must be reported in a Confidential report include, among others: (a) publicly traded securities of corporations and foreign governments, self-administered registered retirement savings plans and self-administered registered education savings plans that are composed of these securities, where these securities are held directly and not through units in mutual funds; (b) any other assets or liabilities that could give rise to a real, apparent or potential conflict of interest due to the particular nature of the public servant's duties; and

Appendix A: Divestment of assets

Public servants must divest assets where their Deputy Head determines that such assets constitute a real, apparent or potential conflict of interest in relation to their duties and responsibilities. Divestment of assets is usually achieved by selling them through an arms-length transaction, or by making them subject to a blind trust arrangement.

Suggested solution(s)

In the first place, even if you are not directly involved in the environmental assessment, you are located in a remote place, which increases the appearance of conflict of interest. The fact of doing business with a small office in a small community could lead a member of the public to question the integrity of government public servants. You should avoid buying shares in this company;

If you have access to information that is not available to the public, you are definitely in a conflict of interest situation and, again, you should avoid buying these shares.

Case No. 2: Opportunity knocks

You are a human resources adviser in a federal department. You heard on the news last night that a computer company that deals with your department's systems group is doing cutting-edge work in the communications field. The company has great potential for growth and you buy 100 shares of its stock, hoping that the new technology will be a success.

What are the implications of your purchase? What should you do?

Factors to consider

• What is your relation, past, present or future with this company?
• Are you in a position to influence any federal government decision concerning the company?
• Did you buy the shares as a result of access to privileged information?

References

Values and Ethics Code for the Public Service.

Appendix A: Assets and liabilities subject to a Confidential Report

The types of assets and liabilities that must be reported in a Confidential report include, among others: (a) publicly traded securities of corporations and foreign governments, self-administered registered retirement savings plans and self-administered registered education savings plans that are composed of these securities, where these securities are held directly and not through units in mutual funds; (b) any other assets or liabilities that could give rise to a real, apparent or potential conflict of interest due to the particular nature of the public servant's duties; and

Appendix A: Divestment of assets

Public servants must divest assets where their Deputy Head determines that such assets constitute a real, apparent or potential conflict of interest in relation to their duties and responsibilities. Divestment of assets is usually achieved by selling them through an arms-length transaction, or by making them subject to a blind trust arrangement.

Suggested solution(s)

Since you learned the information about the company on a news broadcast, it is clear that you did not profit from information that is not generally available to the public.

Although the company may deal with different sectors of your department, you have no access in the course of your duties to information concerning the company.

The fact of owning shares in these circumstances does not represent, in itself, a conflict of interest.

Case No. 3 : Exempt vs. non-exempt assets

You were recently hired by a federal government department and have been asked to provide a written statement of your assets and interests, and of any outside activities. You own some Canada Savings Bonds and you have a registered retirement savings plan. What should you do?

Factors to take into account

• Does the holding of such assets have to be declared under the Values and Ethics Code for the Public Service?

References

Values and Ethics Code for the Public Service.

Appendix A: Assets not requiring a confidential report

Such assets include, among others: (f) Canada Savings Bonds and other investments in securities of fixed value issued or guaranteed by any level of government in Canada or agencies of those governments; (g) Registered retirement savings plans and registered education savings plans that are not self-administered;

Appendix A: Assets and liabilities subject to a confidential report

"The assets and liabilities that must be reported in a confidential report include: (a) publicly traded securities of corporations and foreign governments, self-administered registered retirement savings plans and self-administered registered education savings plans that are composed of these securities, where these securities are held directly and not through units in mutual funds."

Suggested solution(s)

If your registered retirement savings plan is not self-administered, (for example, it is managed by a financial institution and you do not control the assets yourself), you are not required to declare those assets because they are exempt under Appendix A of the Code.

However, if your registered retirement savings plan is self-administered and you feel these assets could represent a conflict of interest with respect to your official duties, you must submit a report, including a list of the assets in your plan.

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