This paper explores the complexities and unintended consequences of conflict of interest (COI) disclosures in various professional settings. It highlights key psychological processes encountered by recipients of such disclosures. Notably, it describes the burden of disclosure effect, which paradoxically reduces trust while increasing compliance due to social pressures, and disclosure's expertise cue, where disclosures inadvertently increase trust and persuasiveness by signalling expertise. The paper also outlines best practices for improving COI disclosures, emphasising the need for external third-party involvement and encouraging deliberation. It concludes that effective disclosure depends not only on how recipients process information but also critically on how the disclosure influences the behaviour of advisors, underscoring the need for a holistic approach to managing COIs that goes beyond mere transparency. A version of this paper was presented as a keynote at the Second Annual International Behavioural Public Policy Conference at the University of North Carolina in September 2023.

Advisors, such as physicians, financial advisors, lawyers and accountants, often face a conflict of interest – that is, a clash between their professional and personal interests. Such conflicts can lead to biased and corrupt advice. In this paper, I focus on how conflicts of interest can cause good people to unintentionally cross ethical boundaries and how we can avoid succumbing to this bias. I first discuss two mechanisms through which advisors may convince themselves to accept conflicts of interest while vehemently believing that they remain unbiased: (1) a sense of entitlement; and (2) a sense of invulnerability created by their belief in their own professionalism. I then discuss several proposed policy solutions to manage conflicts of interest, such as education and training, sanctions, second opinions and disclosure policies. These proposed solutions for dealing with conflicts of interest are largely based on inaccurate intuitions regarding the psychological processes that underlie them; consequently, these policies tend to fail or have unintended consequences. In the absence of eliminating conflicts of interest, solutions that are more likely to be successful consist of identifying and changing the professional norms that exert powerful influences on employee behaviour.

Physicians often believe that a conscious commitment to ethical behavior and professionalism will protect them from industry influence. Despite increasing concern over the extent of physician-industry relationships, physicians usually fail to recognize the nature and impact of subconscious and unintentional biases on therapeutic decision-making. Pharmaceutical and medical device companies, however, routinely demonstrate their knowledge of social psychology processes on behavior and apply these principles to their marketing. To illustrate how pharmaceutical marketing strategies use psychological techniques to promote targeted therapies, we draw on the relevant social psychology literature on conflicts of interest and on the six principles of influence articulated by the eminent social psychologist Robert Cialdini. Hospitals, professional organizations, medical educators, and other stakeholders must also draw on social psychology to respond effectively to commercial activities that compromise good medical practice.

The medical profession is under a state of increasing scrutiny. Recent high profile scandals regarding substantial industry payments to physicians, surgeons, and medical researchers have raised serious concerns over conflicts of interest. Amidst this background, the public, physicians, and policymakers alike appear to make the same assumption regarding conflicts of interest; that doctors who succumb to influences from industry are making a deliberate choice of self-interest over professionalism and that these doctors are corrupt. In reality, a myriad of evidence from social science indicates that influence from conflicts of interest often occurs on a subconscious and unintentional level. This poses an important issue, since such conflicts can steer wellintentioned physicians away from their primary professional goal to provide the best medical advice and treatment possible.