Certified Texas Contract Manager Practice Exam

In procurement, what type of conflict is nepotism considered?

1. A minor conflict

2. A regulatory issue

3. An explicit conflict of interest

4. A management oversight

The correct answer is: An explicit conflict of interest

Nepotism is classified as an explicit conflict of interest because it involves favoring relatives or friends in hiring or contract award decisions within procurement processes. This practice can compromise the integrity of the procurement system, as it may lead to biased decision-making that does not align with the principles of fairness and transparency. In situations governed by ethical standards and regulations, nepotism can undermine public trust and the notion of merit-based evaluation necessary for effective procurement. Given that explicit conflicts of interest are clearly defined and recognized as problematic, nepotism fits this category directly, as it openly pits personal relationships against professional obligations.