Akij Resource

Akij House, 198 Bir Uttam Road Mir Shawkat Sarak, Gulshan Link Road, Tejgaon, Dhaka 1208
Title: Workplace Conflict of Interest Policy
Doc. No. ARL/HR/WCIP/001 Version: 01
Approval Date: 2024/04/30 Effective date: 2024/05/01 Review date: 2024/04/30

1. Purpose

The purpose of this policy is to ensure that all employees of Akij Resource (AR) understand
what constitutes a conflict of interest, recognize situations where potential conflicts may arise,
and follow appropriate procedures to disclose and manage such conflicts. This policy covers
various areas including recruitment, procurement, onboarding customers, mergers and
acquisitions, etc.

2. Scope

This policy applies to all employees, including management, staff, and contract workers across
all departments and units of the company.

3. Definition of Conflict of Interest

A conflict of interest arises when an individual's personal interests, relationships, or affiliations

may influence or be perceived to influence their decision-making process during any stage of
the company’s processes. Such conflicts may include, but are not limited to, financial interests,
familial relationships, personal relationships, or external affiliations with suppliers, contractors,
distributors, customers, existing staffs, new recruits, as well as during Mergers & Acquisitions.
Conflict of interest may arise in the following areas:

a. Procurement process: Selecting and dealing with suppliers/vendors.

b. Sale process: Selecting and dealing with Customers, and distributors.
c. Staff – Dealing with existing staff as well as new recruitment.
d. Mergers & Acquisitions of new entities.
e. All other agreements, and arrangements where monetary transactions are involved.

4. Identification of Potential Conflicts of Interest

Identifying potential conflicts of interest is critical across various business areas to ensure
transparency and maintain the integrity of business operations. Here’s a guide on how conflicts
of interest can be identified in the key areas of recruitment, procurement, onboarding
customers, and mergers and acquisitions:

1. Recruitment:
● Personal Relationships: Employees involved in the hiring process must disclose any
personal relationships with potential candidates. This includes family ties, friendships, or
past professional associations that could affect impartial judgment.
● Financial Interests: Identification of any financial interests that an employee might have
concerning a candidate. For example, if a candidate runs a business on the side that is a
supplier or competitor to the company.
 ● Previous Employment: If a hiring manager previously worked closely with a candidate
in another organization, it could influence their decision-making. This should be
disclosed and may require removing the manager from the hiring decision.

2. Procurement:
● Vendor Relationships: Employees involved in procurement processes need to disclose
any personal relationships with vendors or service providers. This includes any familial
or financial connections that could affect their decision.
● Kickbacks and Gifts: Watch for signs of unusual behavior linked to certain vendors
such as acceptance of gifts, entertainment, favors, or rebates from suppliers which can
indicate a conflict of interest.
● Ownership Stakes: If company personnel or their family members own or have a stake
in a supplier company, this should be disclosed as it might influence procurement
decisions.

3. Onboarding Customers:
● Personal Gain: Employees should not have personal stakes or expect personal gain
from bringing a particular customer on board. For instance, if an employee stands to gain
personally from contracts with certain clients (beyond standard remuneration structures),
it must be considered a conflict of interest.
● Influence and Leverage: Employees who exert undue influence over the onboarding
process for personal reasons, or manipulate terms unduly favorable to the client without
clear business justification.
● Reciprocity: Situations where an employee might favor a client who offers reciprocal
benefits outside of the business scenario.

4. Mergers and Acquisitions:

● Financial Interests: Direct or indirect personal financial interests in the target or
acquiring company need to be declared. For instance, owning shares or bonds in one of
the companies involved in the merger.
● Relationships with Decision Makers: Personal or familial relationships with key
decision-makers or influencers in the process. This might range from corporate
executives to external advisors like legal teams or investment bankers.
● Previous Roles: Previous roles or associations with companies involved, which might
affect their impartiality or lead to insider information usage.

5. Procedures for Disclosure

Establishing a clear and robust disclosure procedure for conflicts of interest is crucial in
maintaining the integrity and transparency of a company's operations, particularly in sensitive
areas such as recruitment, procurement, onboarding customers, and mergers and acquisitions.
Here's a detailed breakdown of an effective disclosure procedure that is to be implemented
across these key areas:

a. Mandatorily disclose any outside business interests (OBI) to the company. OBI includes
investment in a private company as a shareholder, director etc. or in a sole proprietorship
entity, or partnership firm, either by the employee himself, or by his / her spouse, close
relatives, including any other entity in which the employee shares profits.
b. All employees involved in the recruitment, procurement, customer onboarding, mergers &
Acquisition processes must disclose any relationships or financial interests with candidates,
 suppliers, customers, target companies for mergers or acquisitions respectively before
participating in the relevant process.
c. Mandatorily disclose if an employee has any close financial relationships with any another
employee with ARL. This includes investment by two or more employees in the same
company.
d. Mandatorily disclose if an employee has any close personal relationships with any other
employee within ARL. This includes spouse, blood relatives etc.

A standard disclosure form must be prepared for all employees to update and declare their
submission on the above-mentioned areas of conflict of interest. If an employee’s circumstances
changes after the original disclosure, s/he must immediately revise the updated disclosures.
Require employees to provide updates on their disclosed conflicts if there are any changes in
their situation. Disclosures by employees are to be handled confidentially, preserving the privacy
of the information while allowing for appropriate investigation and resolution.

The organization will review all disclosures of conflicts of interest confidentially and impartially,
taking appropriate actions to address and mitigate any identified conflicts.

Failure to disclose or disclosure of incorrect information shall be considered a serious violation

of code of conduct of ARL and shall be handled accordingly.

6. Management of Conflicts of Interest

Mitigation Measures: Upon identification of a conflict of interest, the organization will implement
appropriate mitigation measures to minimize any potential adverse effects on the process, as
stated below:

Recruitment:

1. Recusal: Require individuals with a personal connection to a candidate to recuse

themselves from the recruitment process to ensure impartiality.
2. Panel Interviews: Use interview panels with representation from cross functional team
instead of individual interviews to minimize the influence any one individual has on the hiring
decision.
3. Transparent Hiring Process: Follow a standardized and transparent hiring procedure
where candidate evaluations are documented, and decisions are reviewable by higher
management or HR to ensure fairness.
4. Rotation within HR: In order to ensure absolute transparency in the recruitment process,
HR business partner for a particular SBU should be rotated within other SBUs every three
years.
Procurement:

1. Division of Responsibilities: Split procurement duties among multiple employees to

prevent any one individual from having excessive influence over vendor selection or contract
negotiations.
2. Supplier Rotation and Audits: Implement policies to rotate suppliers periodically and
conduct audits on procurement processes to detect and prevent favoritism or unethical
practices.
3. Approval Process: Establish stringent multi-tiered approval processes for significant
procurements to ensure decisions are vetted by multiple stakeholders.
4. Any procurement staff having outside business interest shall not be eligible to continue
within the procurement team.
5. ARL may also consider rotating procurement department staff every three years through
new recruits or by staff from another department.
6. No close relatives shall be eligible to work within the same department or in departments
which are expected to ensure check and balance e.g., Procurement and Audit team. Close
relatives may be allowed to work only in departments or roles in which they will not have any
influence on / interaction with each other.
Onboarding Customers:

1. Standardized Procedures: Create standardized onboarding processes that must be

followed for all customers, thereby reducing the potential for preferential treatment.
2. Separation of Duties: Ensure that the same person does not handle both negotiation and
approval of new accounts to avoid bias.
3. Third-party Reviews: Use third-party checks where applicable to validate customer
information independently and provide an unbiased assessment.
4. Any sales staff having any personal business relationship with a client or distributor, can
not be the responsible sales person for the same client or distributor.
5. ARL should rotate the sales staff every three years in different regions to be responsible
for different dealers / customers.
Mergers and Acquisitions:

1. Due Diligence Teams: Form diverse and multi-disciplinary teams to conduct due diligence.
This reduces the risk of overlooking conflicts of interest due to the varied perspectives and
expertise involved.
2. External Advisors: Engage external consultants and advisors to provide impartial advice on
the transaction, helping to identify and mitigate any conflicts of interest that internal team
members might overlook.
3. Conflict of Interest Disclosures: Require all decision-makers involved in the merger or
acquisition to disclose any possible conflicts of interest prior to engaging in negotiation or
evaluation processes.

In addition, following additional checks would be used to mitigate risks:

1. Regular Auditing and Monitoring: Conduct regular audits of processes susceptible to

conflicts of interest. Monitoring tools and occasional third-party audits can help identify and
mitigate risks that might not be evident internally.
2. Whistleblower Protections: Implement a secure and anonymous system where employees
can report unethical behavior or conflicts of interest without fear of retaliation.

7. Training and Awareness

ARL will provide regular training and education to all individuals involved in recruitment,
procurement, and sales activities to increase awareness of conflict of interest issues and their
obligations under this policy.

8. Reporting
Any concerns or suspicions regarding potential conflicts of interest in the recruitment,
procurement and sales activities should be reported promptly to the designated officer or head
of Internal audit copying the secretary to the CEO for investigation and appropriate action. ARL
shall keep the name of the reporter confidential and may consider rewarding for major factual
reporting.

9. Confidentiality

All disclosures of conflicts of interest related to recruitment, procurement and sales activities will
be treated with utmost confidentiality, consistent with applicable laws and regulations.
Information regarding conflicts of interest will only be disclosed on a need-to-know basis to
individuals involved in the review and management process.

10. Compliance

All individuals involved in recruitment, procurement and sales activities are expected to comply
fully with this policy and cooperate with any inquiries or investigations related to conflicts of
interest conducted by the organization. A one-off exercise shall be done to review all existing
vendors as well as Dealers / customers to ensure there is no conflict of interest.

Any willful non-compliance would be considered a serious breach of conduct and will be
handled accordingly.