ANAB Advisory on Conflict of Interest with Consulting

This article is based on ANAB Advisory 16. To see other Advisories, go to: http://www.anab.org and click on “Advisories”.

ANAB Advisories represent positions taken, or policies established, on operational issues related to programs operates by ANAB. One basis of the value of third-party conformance assessment and certification is that the registration process, audits, and certification decision are objective and impartial and not influenced by conflicting interests. This basic premise is unambiguously expressed in ISO Guides 62 and 66 and related IAF Guidance.

The requirements for safeguarding impartiality apply at three levels: the structure and operation of the certification body (CB), personnel (including employees, contractors, and subcontractors), and relationships with other bodies.

There has been satisfactory experience safeguarding impartiality of audits with the historic and longstanding requirement that an auditor for a third-party registration audit cannot have consulted with the client organization being audited for at least two years (IAF Guidance on the Application of ISO Guide 62:1996 Clause G.2.1.30 and IAF Guidance on the Application of ISO Guide 66:1999 Clause G.4.1.29).

There has also been satisfactory experience safeguarding impartiality of audits and registrations for the automotive sector with the following QS-9000 requirement: “Organizations that have provided quality system consulting services in the past two years to a particular client are not acceptable as certification bodies/registrars for that client, nor may they supply auditors. This restriction includes subsidiaries or affiliates of the same parent company” (QS-9000:1998 Appendix B Clause 9).

This successful experience with auditors and the automotive sector led the aerospace sector to establish a similar requirement: “CRBs processes and requirements to obtain an AQMS sector qualification, shall include as a minimum: prohibition against certifying/registering an organization to an AQMS with whom a related body has provided consulting services related to certification/registration of said organization within the past two year. Any individual, who has in the past two years provided consulting services to an organization, shall have no involvement with the certification/registration of that organization. Where there might appear to be a conflict of interest, either through consulting or the offering of training to a potential client, this shall be disclosed to the ABs and RMC prior to performing the registration process to determine if there is a conflict of interest” (SAE AIR5359: 2003 Clause 6.3j).

There is within the United States a very heightened awareness of the conflict of interest when an organization or related organizations provide both auditing and consulting. This heightened awareness led many stakeholders to challenge the safeguards in the third-party certification system for ISO 9001 and ISO 14001 management systems. This challenge was posed directly to the ANAB, as the national accreditation body for the United States.

This led the ANAB Board of Directors to form an ad-hoc Conflict of Interest Task Force. The task force recommended that ANAB implement this requirement now as an Advisory, rather than waiting for the adoption of ISO 17021 (Conformity assessment – Requirements for bodies providing audit and certification of management systems) to improve safeguards that prevent conflicting interests between a CB and a management systems consultancy. ISO/CASCO Working Group 21 has developed what is generally perceived to be a better solution to this issue by focusing on the activity that is of concern rather than relying upon a definition of a related body. Therefore, this Advisory is changed to be consistent with the wording in ISO/DIS 17021.

To understand this Advisory, it is necessary to have a definition for management systems consultancy. The following is the definition from ISO/DIS 17021:

Definition: Management System Consultancy – participation in designing, implementing, or maintaining a management system.

Examples

a. preparing or producing manuals or procedures;
b. giving specific advice, instructions, solutions, or training towards the development and implementation of a management system;
c. conducting internal audits.

Note: Arranging training and participating as a trainer is not considered consultancy, provided that where the course relates to management systems or auditing, the course is confined to providing generic information and advice that is freely available in the public domain, that is, the trainer should not provide company-specific solutions.

Advisory

A CB shall not certify a management system for a client that has received management systems consultancy on the same management system, where the relationship between the consultancy body and the CB poses an unacceptable threat to the impartiality of the certification body.

Note 1: Allowing a minimum period of two years to elapse following the end of the management system consultancy is one way of reducing the threat to impartiality to an acceptable level.

Note 2: A relationship that threatens impartiality between the CB and management systems consultancy body may be based on ownership, governance, management, personnel, shared resources, finances, contracts, marketing, and payment of a sales commission, or other inducement for the referral of new clients, etc.

Note 3: This Advisory is not intended to apply to an individual under the direct contractual control of a CB because other accreditation requirements apply that prohibit any auditor from participating on an audit for a client that the auditor may have consulted or was otherwise employed by the client for at least two years.