Ethical conduct of regulators is important because control mechanisms, such as appeals and due process, are imperfect and may be costly. Instruments for encouraging ethical conduct include adopting conflict-of-interest standards and codes of conduct. A conflict of interest may occur if, for example, the regulator or the regulator’s family members having financial stakes in operators, or if the regulator has either recently worked for an operator or another stakeholder, or has served as a consultant for a stakeholder, or has negotiated future employment or business arrangements with a stakeholder. In the UK, for example, regulators have to obtain permission from ministers to work in their area of regulation after leaving the regulatory authority. Codes of conduct often cover such issues as meetings with stakeholders, record keeping procedures, and political activities.