Paul Martin's decision to transfer his stake in Canada Steamship Lines (CSL) may reduce the scope of potential conflicts of interest that can emerge if he becomes prime minister, but without effectively enforced ethics rules for politicians, his actions will be little more than a meaningless half gesture.

Federal ethics rules for politicians, contained in the public office holders' code, require ministers to "arrange their private affairs in a manner that will prevent real, potential or apparent conflicts of interest from arising" and "that will bear the closest public scrutiny."

The rules also require ministers to avoid even "the appearance of being placed under an obligation to any person or organization . . . that might profit from special consideration" and "to uphold the highest ethical standards so that public confidence and trust in the integrity, objectivity and impartiality of government are conserved and enhanced."

There was no way for Martin to meet this standard if he continued to own the CSL shipping empire as prime minister.  As owner of a highly regulated company, the appearance that he owes something to the business would be ever-present.

Unfortunately, the issue does not get put to rest by Martin simply transferring his CSL shares to his sons.  As ownership still rests with close family members (rather than being sold to a third party, as many advocated), there is still great potential for conflicts of interest to occur.  The only way to minimize this potential is to ensure that ethics rules act as a deterrent and, if necessary, to have an investigative watchdog.

The current prime-minister-appointed ethics counselor must first be replaced by an independent ethics commissioner, appointed by Parliament, with the consent of opposition party leaders.  This new position must have full investigative powers, and the authority to fine elected officials who break the rules.  Members of the public must have the right to file complaints with the commissioner, and there must be whistleblower protection so they cannot be retaliated against by those in powerful positions of public office. 

The current rules do not cover backbench MPs and senators, so if a future conflict emerges with CSL, Martin could claim that he was simply acting as an MP looking out for his constituents, and is therefore not covered by the public office holders' code.  While this might sound like a stretch, it was exactly this defence that was employed by the current prime minister in the Shawinigate and Business Development Bank scandals.

While Martin has said he supports having an independent ethics watchdog, he has yet to spell out how that person would be appointed, or what the office would look like.  In this regard, we should not be encouraged by his initial response to the CSL revelations.  Employing the tried and true Liberal strategy of hiding behind Howard Wilson's skirt, Martin said that he had the okay from the ethics counselor on his blind trust arrangement, and even enlisted Wilson in drafting guidelines that would allow the prime-minister-in-waiting to keep CSL.

Martin, Wilson, and several commentators have argued that having effective enforcement of ethics rules will make business people less likely to run for public office.  This sentiment was most arrogantly (and forthrightly) expressed by Globe and Mail columnist John Ibbitson, when he warned last week that if Martin is forced to divest, "only those who have failed to make it in the real world need apply for the top political job in the land."

Here's a crisis we were all unaware of.  Business people in Parliament must be a grossly under-represented lot, and putting in place measures to ensure they don't mix their business interests with their political decisions would force their numbers down even further.

Then there are the facts.  In the current Parliament, fully 25 percent of MPs are from the senior ranks of business, more than from any other occupation.  This number has been steadily increasing:  in the 1950s, just 4 percent came from senior management; in the 1970s, it was 16 percent; in the 1980s, it was 22 percent.  Occupations such as teachers, health care workers, scientists and others who Ibbitson would write off as failures who would nonetheless be poised to overwhelm the parliamentary roster each rank in the single digits as a percentage of MPs.

This is not to say we should be trying to discourage those from the business sector from running for office, just that we shouldn't be overly concerned about business people becoming an endangered species on the Hill. 

More importantly, there is simply no evidence that effective ethics rules dissuade people from entering politics.  The United States has the strictest rules on separating business interests from politics.  Yet 41 members of the Bush administration had ties to the oil industry before entering government, including the president himself, Vice President Dick Cheney, and National Security Advisor Condaleeza Rice, who is a former Chevron director. 

Having effectively enforced rules to keep elected officials accountable doesn't preclude people who are in business from becoming the people who run the country.  It simply says you can't do both at the same time.