The Run-Down: CNN’s President, Jeff Zucker, announced his resignation yesterday, citing a failure to disclose a “consensual” relationship with CNN executive Allison Gollust

1. This announcement comes right on the heels of CNN firing former journalist, Chris Cuomo, in December, for his involvement in an alleged sexual harassment situation involving his brother, Andrew Cuomo.
2. As a part of company-wide investigations, Zucker was asked to disclose when he entered into the relationship with his co-worker, however, he failed to do so.
3. Allison Gollust will remain at CNN, continuing to serve in her role as Executive Vice President and Chief Marketing Officer

Why You Should Care:

A conflict of interest can exist whenever an employee’s judgment or decision-making can be, or already is, improperly influenced by personal interests. Notably, there can simply be a perceived conflict, not an actual one, that sends an organization into disarray. Because of the potential reputational, cultural, and even legal risks conflicts of interest pose, it is vital that every organization is properly addressing these concerns. Conflicts of interest can cause mistrust amongst employees and ultimately create an uncomfortable work environment. Even further, a conflict may actualize financial and legal risk to your business.

Zucker’s resignation from CNN is a perfect example of how conflicts of interest can impact an organization. Here, the decision to resign was all about perception. Organizations must thoroughly educate their employees on the risks of conflicts of interest, and more importantly, on how to properly disclose such risks. Had Zucker disclosed his relationship, which on its face is not an outright conflict, the outcome of his time at CNN may have been different. But, because of whatever worries Zucker had, maybe a potential fear of retaliation or misunderstanding of the importance of conflict disclosures, CNN must now face the public backlash and fend off questioning into the integrity of their brand. Ultimately, your organization will always be at risk for a potential conflict of interest to arise. However, with the development of a strong compliance program and efficient conflict of interest training, you can ensure your business is adequately prepared to address these issues if, and most likely when, they do occur.