Domain H · Area H-CA1 · Integrity, scepticism, judgement and escalation

H.5Identify and manage conflicts of interest and threats to objectivity

Working Draft version 1.1

Purpose and scope

This unit covers the capability to identify actual, potential and perceived conflicts of interest and threats to objectivity or independence in sustainability reporting, advisory, review, assessment and assurance-related work. It includes financial, personal, organisational and commercial interests; self-review, management participation, advocacy, familiarity, gifts, fees, referrals and prior work; disclosure, safeguards, recusal, reassignment, refusal, withdrawal and ongoing monitoring.

Applied competency statement

Can identify, assess, disclose and manage actual, potential and perceived conflicts and independence threats through proportionate safeguards, recusal, reassignment, refusal, withdrawal and documented monitoring.

Boundary and escalation

This unit owns general conflict-of-interest and objectivity-threat governance across reporting, advisory, review and assessment work. F.9 owns formal service and assurance independence boundaries, D.7 owns provider-related conflicts and C.2 owns role and segregation design. Applicable professional and legal regimes determine mandatory independence rules and prohibited relationships.

Key quality risks

Conflicts assessed only when a formal assurance engagement begins; financial, family, employment or referral interests not declared; prior preparation or advisory work creating self-review; practitioner making management decisions and later reviewing them; gifts, contingent fees or commercial dependence influencing judgement; long familiarity normalised; organisational conflict hidden behind separate individuals; disclosure treated as sufficient without an effective safeguard; and perceived conflicts ignored because the practitioner believes objectivity is unaffected.

Required knowledge · 6

H.5-K01

Understands actual, potential and perceived conflicts and the distinction between conflict identification, significance assessment, disclosure and management.

Knowledge Type: Conflict concepts · Normative Weight: Core

H.5-K02

Understands self-interest, self-review, management participation, advocacy, familiarity, intimidation, referral, contingent-fee, employment and organisational threats.

Knowledge Type: Threat categories · Normative Weight: Core

H.5-K03

Understands financial interests, gifts, hospitality, family and personal relationships, prior work, future employment, provider dependence, subcontractors and client or internal incentives.

Knowledge Type: Relevant interests and relationships · Normative Weight: Core

H.5-K04

Understands role, decision authority, materiality, proximity, duration, public perception, available alternatives and the effect on objectivity, review and public trust.

Knowledge Type: Significance assessment · Normative Weight: Core

H.5-K05

Understands disclosure, independent review, separate teams, changed responsibilities, restricted participation, recusal, reassignment, refusal, withdrawal and governance oversight.

Knowledge Type: Safeguards and responses · Normative Weight: Core

H.5-K06

Understands declarations, registers, updates, engagement changes, new relationships, approvals, residual threats, public wording and retention.

Knowledge Type: Monitoring and documentation · Normative Weight: Core

Applied skills · 5

H.5-S01

Identify relevant interests, relationships, roles and services that may create actual, potential or perceived conflicts.

Skill Type: Core applied capability · Observable Output or Result: Conflict and independence declaration and register

H.5-S02

Assess the type, significance, affected decisions, public perception and whether the threat can be reduced to an acceptable level.

Skill Type: Threat assessment · Observable Output or Result: Threat significance and safeguard assessment

H.5-S03

Define specific disclosure, review, separation, restriction, recusal, reassignment, refusal or withdrawal actions and responsible owners.

Skill Type: Safeguard design · Observable Output or Result: Conflict safeguard and action plan

H.5-S04

Implement safeguards, monitor changed circumstances and reassess conflicts throughout the reporting or service period.

Skill Type: Implementation and monitoring · Observable Output or Result: Recusal, reassignment, refusal and monitoring record

H.5-S05

Explain conflicts and residual threats to affected parties and governance bodies without minimising commercial or reputational consequences.

Skill Type: Communication and escalation · Observable Output or Result: Conflict communication and approval record

Professional behaviours · 3

H.5-B01

Does not conceal or delay disclosure of an interest or relationship because it may affect a role, engagement or commercial opportunity.

Behaviour Type: Conflict transparency · Non-compensable Requirement: Yes

H.5-B02

Does not treat disclosure alone as sufficient where the threat requires independent review, recusal, reassignment, refusal or withdrawal.

Behaviour Type: Safeguard substance · Non-compensable Requirement: Yes

H.5-B03

Considers how a reasonable informed observer may view the relationship and does not rely only on personal confidence in objectivity.

Behaviour Type: Perception awareness · Non-compensable Requirement: Yes

Typical tasks · 4

H.5-T01

Complete and update declarations covering roles, services, interests, relationships, fees, gifts, prior work and future opportunities.

Primary Output Link: H.5-O01

H.5-T02

Assess the significance and affected decisions and determine applicable requirements and possible safeguards.

Primary Output Link: H.5-O02

H.5-T03

Obtain approval and implement disclosure, separation, independent review, recusal, reassignment, refusal or withdrawal.

Primary Output Link: H.5-O02

H.5-T04

Monitor the arrangement, document changes and residual threats and renew or close the assessment when circumstances change.

Primary Output Link: H.5-O03

Expected outputs · 3

H.5-O01

Conflict and independence declaration and register

Output Type: Professional work product

H.5-O02

Threat significance and safeguard assessment

Output Type: Professional work product

H.5-O03

Recusal, reassignment, refusal and monitoring record

Output Type: Professional work product

Proficiency indicators

Level 1 · Foundation

H.5-L1-01

Can complete established conflict declarations, identify obvious interests or relationships and follow approved safeguard and escalation procedures.

Indicator Dimension: Task execution

H.5-L1-02

Can recognise when disclosure may be insufficient and seek review of recusal, reassignment or service-boundary questions.

Indicator Dimension: Quality, judgement and accountability

Level 2 · Practitioner

H.5-L2-01

Can independently identify, assess and manage conflicts and objectivity threats in a moderately complex reporting or advisory assignment.

Indicator Dimension: Task execution

H.5-L2-02

Can design proportionate safeguards, monitor residual threats and explain the implications to management, clients and reviewers.

Indicator Dimension: Quality, judgement and accountability

Level 3 · Advanced Practitioner

H.5-L3-01

Can design or critically review organisation-wide conflict and independence governance across reporting, advisory, assessment and assurance-related activities.

Indicator Dimension: Method design and review

H.5-L3-02

Can challenge commercially sensitive conflicts, determine when safeguards are inadequate and advise governance bodies on recusal, refusal, withdrawal and public-trust implications.

Indicator Dimension: Leadership and governance

Illustrative evidence · 6

H.5-E01

Conflict and independence declaration and register.

Evidence Type: Work product

H.5-E02

Threat significance and safeguard assessment.

Evidence Type: Work product

H.5-E03

Recusal, reassignment, refusal and monitoring record.

Evidence Type: Work product

H.5-E04

Interest, relationship, service, approval, safeguard and reassessment trail.

Evidence Type: Process evidence

H.5-E05

Documented ethics, legal, governance, assurance, HR or management review and the practitioner's response.

Evidence Type: Review evidence

H.5-E06

Observed response to a commercially or personally sensitive conflict scenario.

Evidence Type: Observed performance

Assessment · 3

H.5-A-L1

Conflict-identification exercise, declaration review and situational judgement

Conflict recognition; actual, potential and perceived perspectives; safeguard awareness.

H.5-A-L2

Integrated conflict-management case and written professional memorandum

Threat assessment; safeguard design; service and role boundaries; documentation and communication.

H.5-A-L3

Complex independence case, portfolio and oral defence

Method design; public-perception and residual-threat judgement; resistance and governance advice; oral defence.

Relationships · 10

From	To	Type	Rationale
C.2	H.5	Professional conduct and collaboration linkage	Role allocation and review must address conflicts, self-review and independence safeguards.
D.7	H.5	Professional conduct and collaboration linkage	Provider selection and oversight require identification and management of actual, potential and perceived conflicts.
F.9	H.5	Professional conduct and collaboration linkage	Conflicts and independence threats require disclosure, safeguards, recusal, refusal or withdrawal.
H.1	H.5	Professional conduct and collaboration linkage	Objectivity threats arising from interests and relationships are assessed and managed through conflict governance.
H.5	F.9	Boundary distinction	Conflicts and independence threats affect service combinations, assurance claims and safeguards.
H.5	D.7	Governance and role linkage	External adviser and service-provider selection and oversight should consider conflicts and commercial incentives.
H.5	H.1	Governance and role linkage	Conflict management supports integrity and objectivity in professional work.
H.5	H.6	Professional conduct and collaboration linkage	Unmanaged or concealed conflicts may require escalation, recusal, refusal or withdrawal.
H.5	C.2	Governance and role linkage	Role allocation, segregation and decision rights may act as safeguards or create self-review and management-participation risks.
H.6	H.5	Professional conduct and collaboration linkage	Commercial or personal conflicts may create pressure or affect the appropriate escalation route.

Role profiles for this unit

Role	Target level	Relevance	Evidence expectation
Corporate Sustainability Reporting Practitioner	Practitioner	Required?	A case or work sample demonstrating independent performance, documented judgement and a reviewable professional output.
Sustainability Reporting Manager or Lead	Advanced Practitioner	Role-defining?	A complex case or verified portfolio, supplemented by oral or observed defence, demonstrating method design, challenge and governance capability.
Sustainability Reporting Adviser or Consultant	Advanced Practitioner	Role-defining?	A complex case or verified portfolio, supplemented by oral or observed defence, demonstrating method design, challenge and governance capability.
Sustainability Data, Systems and Controls Specialist	Practitioner	Required?	A case or work sample demonstrating independent performance, documented judgement and a reviewable professional output.
Assurance Readiness and Reporting Quality Specialist	Advanced Practitioner	Role-defining?	A complex case or verified portfolio, supplemented by oral or observed defence, demonstrating method design, challenge and governance capability.
Investor, Capital Markets and Ratings Disclosure Specialist	Advanced Practitioner	Role-defining?	A complex case or verified portfolio, supplemented by oral or observed defence, demonstrating method design, challenge and governance capability.