This is a situation where an individual, employee, or a corporate entity has a vested interest in something that makes their vote or input unreliable. For example, cosmetics tycoon and board member Mabel Doughy voted in favor of granting a multi-year contract to Sticky Lipsticks, a major lipstick manufacturing company. The problem? Her son, Hughie Doughy, is CEO of Sticky Lipsticks.
Mabel needs to disclose her association with Hughie and abstain from voting on this issue.