Managing Conflicts of Interest in a Multi-Client Environment

In the consulting world, success is built on relationships, reputation, and trust. But what happens when a consultant begins to serve multiple clients in the same industry, or even direct competitors? Managing conflicts of interest in a multi-client environment is not just an ethical necessity; it's a strategic imperative. Done poorly, it can damage relationships and credibility. Done well, it becomes a distinguishing marker of professionalism and integrity.

Consultants, especially in niche industries, inevitably face scenarios where clients’ interests intersect or even clash. This is common in sectors like finance, healthcare, legal services, and ERP implementation, where specialization often leads consultants to work with similar types of organizations.

Take Boston Consulting Group (BCG) for example, the company worked extensively with major retail brands like Walmart and Target. While each engagement is approached independently, the firm must be extremely careful not to let insights gained from one client influence strategies or recommendations made to the other. Even subtle overlaps, such as best practices in logistics or consumer trend analysis, must be handled delicately to avoid violating trust or inadvertently giving one party a competitive edge.

McKinsey & Company, one of the world’s most prominent consulting firms, has faced public scrutiny for conflicts of interest on several occasions. One widely discussed case involved McKinsey advising Purdue Pharma on how to "turbocharge" OxyContin sales, while also consulting for the U.S. Food and Drug Administration (FDA) on opioid policy. Though the engagements were technically separate, the overlap in subject matter and timing raised serious concerns about ethical boundaries. The reputational fallout led to congressional investigations, client backlash, and significant damage to McKinsey’s brand. In response, the firm took major steps to reinforce internal firewalls, strengthen nondisclosure protocols, and revise how it evaluates client alignment across industries.

Even smaller firms face these challenges. Consider Slalom, a boutique consulting firm known for its work in cloud technology and digital transformation. In recent years, Slalom has worked with both Salesforce and HubSpot, two CRM platforms that compete in overlapping markets. To navigate this, the firm uses separate project teams and data silos, ensuring that no confidential insight from one engagement influences another. In internal interviews, Slalom’s leaders have emphasized the importance of transparency, client agreements with clear conflict clauses, and team separation to maintain trust and professionalism.

Independent consultants must be just as diligent. When taking on a new client, it’s critical to be upfront about prior or current engagements with similar organizations. Clients may still choose to proceed, but they’ll do so with informed consent. Many will even value the experience you bring, provided you make it clear how you’ll protect their proprietary information.

One way to do this is through detailed engagement letters. These documents should outline how potential conflicts of interest will be identified, evaluated, and addressed. For instance, you might commit to not working with direct competitors for a certain period or promise to maintain separate systems and personnel for competing clients.

Unintentional leaks are also a major risk. When you've been deeply embedded in a client’s operations, it's easy to forget what was shared in confidence. Even casual references in informal conversations can undermine trust. Good consultants document thoroughly, stick to general language when discussing industry insights, and avoid naming or implying specific clients when they’re not directly involved.

Sometimes, the best decision is to step away. If neutrality can't be preserved, recusing yourself protects all parties and signals that your integrity is worth more than the next project.

To illustrate this, consider the case of PwC Canada. In 2022, PwC was engaged by both Loblaw and Empire Company (which owns Sobeys) for different supply chain digitization initiatives. While the firm did not disclose the details of each engagement publicly, both clients reported satisfaction with how PwC handled confidentiality and project separation. According to insider accounts, each project team was kept completely siloed, including separate infrastructure, reporting structures, and non-disclosure training tailored to the specific sensitivities of the retail sector.

In today’s competitive landscape, clients are more attuned than ever to the risks of overlapping consultants. They’re entrusting you not just with data and strategy, but with access to the inner workings of their organizations. Your ability to manage competing interests, remain neutral, and protect confidentiality defines your value as a strategic partner.

Managing conflicts of interest isn’t about choosing sides. It’s about designing your consulting practice, regardless of size, with the policies, discipline, and integrity required to serve multiple clients without compromising any of them. Whether you're an independent advisor or part of a global firm, the systems you put in place today will define the quality of your relationships tomorrow.