Why are conflicts of interests a problem in business?

Let's say you're an investor. You've invested in a company that sells bagels and you obviously want them to succeed. If you were to invest in another company that sells bagels, both of your companies would depend on the same customer base as both are selling bagels. If you help one company more, then that one will be more likely to succeed and vice versa. This is the main reason why there is a conflict of interests.

To keep up with the demands of industrialization