Conflict of Interest & Client Segregation Policy

1. Introduction

PMG Consulting (PMG) operates a multi-faceted business model encompassing Consulting, Equity Partnerships, Licensing, and White-Label services. This model creates inherent potential for conflicts of interest. PMG is unconditionally committed to identifying, managing, and eliminating such conflicts to protect client confidentiality, uphold fiduciary duties, and maintain the trust of all clients and partners. This policy establishes the mandatory rules and procedures for all PMG personnel, embedded leaders, equity partners, and licensees.

2. Scope

This policy applies to all PMG personnel (as defined in the IP Policy), including employees, contractors, consultants, embedded leaders, and executives. It further applies to all PMG-affiliated entities, including Equity Partnerships and Licensees operating under a PMG agreement. Compliance with this policy is a fundamental condition of engagement with PMG.

3. Definitions

Conflict of Interest: A situation in which a person’s or entity’s professional judgment or actions regarding a primary interest (client welfare, PMG’s fiduciary duty) could be unduly influenced by a secondary interest (financial gain, other client relationships, equity holdings).

• Chinese Wall: Formal information barrier procedures designed to prevent the flow of confidential information between segregated parts of the business.
• Licensee: An independent entity granted a license by PMG to operate certain PMG methodologies, systems, or service models under defined terms and within an exclusive territory or client segment.
• Embedded Leader: A PMG personnel embedded in a client organization in a fractional or interim leadership capacity.
• Equity Partnership: A company in which PMG holds a qualifying ownership stake of 12.5% or more within a specific geographic market.
• Ethics Officer: The designated PMG officer responsible for administering this policy. The Ethics Officer can be reached at legal@askpmg.com.

4. Identification of Conflicts: Explicit Examples

A Conflict of Interest includes, but is not limited to, the following scenarios:

• Competing Clients: Simultaneously working for two clients who are direct competitors in the same product, service, or geographic market, where confidential information of one could benefit the other.
• Equity & Consulting Cross-Over: Holding a qualifying Equity Partnership in a company while providing consulting services to a direct competitor of that company within the same sector and geographic market.
• Licensed Entity Conflict: A PMG Licensee bidding for or engaging in a project against PMG headquarters or against another PMG Licensee for the same client opportunity.
• Misuse of Confidential Information: Using or disclosing the confidential information, data, or strategies of Client A for the benefit of Client B, an Equity Partnership, or a Licensee.
• Encroachment: A Licensee actively soliciting or engaging with a client outside its granted exclusive territory or segment, or a client that has an active, direct consulting relationship with PMG headquarters, unless explicit authorization is obtained via licensing@askpmg.com.

5. Mandatory Disclosure & Recusal Process

Duty to Disclose

All personnel, Embedded Leaders, and Licensees must promptly disclose any actual, potential, or perceived Conflict of Interest to the Ethics Officer immediately upon awareness. For consultants and Embedded Leaders, this disclosure must occur prior to accepting a consulting role. Disclosure must be submitted in writing to legal@askpmg.com.

Primary Consultant Responsibility

PMG cannot be aware of every potential conflict. Individual consultants and Embedded Leaders bear the primary responsibility for evaluating potential engagements for conflicts before acceptance. Disclosure can be fulfilled by informing the assigned project manager or by formally declining the consultation with a statement of conflict.

Formal Assessment

The Ethics Officer will conduct a formal assessment of the disclosed conflict, which may include consultation with relevant business unit leaders.

Recusal & Mitigation

Upon a finding of a conflict, the Ethics Officer will mandate appropriate actions, which may include:

• The immediate recusal of specific individuals or entire teams from an engagement or decision-making process.
• The formal erection of a Chinese Wall (as per Section 6).
• In severe cases, the declination or termination of an engagement.

Formal Record

All disclosures, assessments, and mandated actions will be documented and retained by the Ethics Officer.

6. Chinese Wall Procedures

To segregate information and teams, the following formal protocols are mandatory:

• Physical & Digital Segregation: Strict separation of data repositories, communication channels, and project management tools between segregated units (e.g., White-Label unit vs. direct Consulting practice; Equity management team vs. sector consulting teams).
• Access Controls: Confidential information shall be accessible only to personnel explicitly authorized on a specific engagement. Access rights will be regularly audited.
• Team Segregation: Personnel assigned to a client engagement may not simultaneously work on, or have access to, the materials of a conflicting engagement (as defined in Section 4). Project staffing decisions must be cleared for potential conflicts prior to assignment.
• Licensee Segregation: Confidential information and client lists pertaining to PMG’s direct consulting practice or to other Licensees shall not be shared with a Licensee unless necessary for a jointly approved project and governed by a separate confidentiality agreement.

7. Licensee-Specific Covenants

The Licensee Agreement shall contain explicit covenants governing client engagement, including:

• Territorial/Client Exclusivity: Clear definition of the exclusive territory or client segment granted to the Licensee. Licensees are prohibited from operating outside this granted scope without prior written consent from PMG, obtainable via licensing@askpmg.com.
• Non-Encroachment: A covenant prohibiting Licensees from actively soliciting or engaging clients within the exclusive territory or segment of another Licensee, or clients with an active direct relationship with PMG HQ.
• Conflict Arbitration: A process, administered by the PMG Ethics Officer, to arbitrate and resolve conflicts that arise between Licensees or between a Licensee and PMG HQ.

8. Equity Portfolio Management Rules

To manage conflicts arising from Equity Partnerships:

• Blanket Restrictions: PMG will not undertake a consulting engagement for a direct, head-to-head competitor of a qualifying Equity Partnership (12.5% ownership or more within a geographic market) without prior written consent from the Equity Partnership’s board.
• Informed Consent: If PMG determines a consulting engagement with a competitor of an Equity Partnership may proceed, the consulting client must be informed in writing of PMG’s qualifying equity interest in its competitor prior to engagement commencement.
• Strict Chinese Wall: The consulting team serving the competitor client shall be strictly segregated from the PMG team interfacing with the Equity Partnership, with no flow of confidential information.

9. Sanctions for Violation

Violation of this policy constitutes a serious breach of trust and contract.

• For PMG Personnel: Disciplinary action will be taken, up to and including immediate termination of employment and pursuit of legal remedies for damages.
• For Embedded Leaders & Contractors: Engagement will be terminated for cause.
• For Licensees: Violation constitutes a material breach of the Licensee Agreement, potentially resulting in revocation of the license, termination of the agreement, and forfeiture of fees.
• For Equity Partnerships: Breach by the partnership may result in the dilution or divestment of PMG’s stake and termination of any commercial agreements.
• All expenses incurred by PMG in investigating a violation and enforcing its rights (including legal fees) shall be borne by the violator.

10. Policy Governance

The Ethics Officer is responsible for the implementation, interpretation, and periodic review of this policy. All parties governed by this policy agree to abide by the determinations of the Ethics Officer.