Keeping gifts ethical

Monday, 07 December 2009 09:37

The ethics of relationship building

We have arrived at the time of year when traditionally big customers, business associates and those who play important roles in how smoothly and quickly we can conduct our business, are thanked by “tokens of our appreciation”. Next year's 2010 Fifa Soccer World Cup is set to bring a round of “appreciation” in its own league. Lindie Engelbrecht, chief executive of the Institute of Directors Southern Africa, writes about: “Relationship building by any other name… the fine line between gifts and just plain bribes.”

Without doubt, the hottest ticket in town next July will be one to the final match of the 2010 Fifa Soccer World Cup, preferably with a limo drive from a fancy hotel where the lucky ticket holder is booked to stay, too. Not to mention a host of other little sweeteners being cooked up by organisations in the name of relationship building.

Most tickets being bought at great cost by companies are not for the purposes of entertaining their own employees. These sought-after slips of paper are being purchased as gifts for valued clients – something of worth given without any expectation of return; perhaps, a gesture of thanks for a cordial working relationship.

Those with less faith in humanity should be sniggering around about now.

But the truth is there is a fine line between gifts and bribes – and those in influential positions should take care to stay on the correct side of it.

While a gift is given without expectation, a bribe is the same thing given in the hope of currying favour for purposes of future influence or benefit.

Although senior employees and government officials may already be invited to the World Cup or be in a position to buy tickets themselves, it is what those lower down in the organisation are doing – or being tempted to do – which should be considered.

Because it is practically impossible to figure out the expectation of the giver, it is wise for both public and private sector employees to adhere to rules that restrict gifts. These vary from disallowing gifts over a certain amount to requiring simply that they be reported.

Some years ago, when faced with allegations of widespread corruption and kickbacks, Siemens AG famously began disallowing any type of behaviour that could facilitate the industry-wide wink-and-nod culture. For example, sales representatives were no longer allowed to go golfing with doctors they hoped to do business with, even if competitors were doing the same thing.

Each organisation needs to decide for itself exactly where the line will be drawn. It may well be true that a ticket to the game or bottle of wine will not influence a trusted employee’s future decision regarding business.

That said, it is worth bearing in mind why pharmaceutical companies bother going to the trouble and expense of making those ubiquitous transparent paperweights bearing the names of the latest drug they are pushing, or any number of other novelties that litter doctors’ consulting rooms. Same goes for those innocent-looking notepads and calendars.
In and of themselves, these items are harmless, but like hot tickets, they succeed in getting one’s attention. After all, doctors will not prescribe products they have never heard of.

The point is simply for ethical employees to recognise that any gift from someone wanting to do business is intended to exert an influence. And even if the gestures do not succeed in swinging the vote or securing business, accepting them can give the appearance of ‘being on the take’, which undermines confidence.

That is why it is so important right now for companies – and the government – to review their gift policies, educate employees regarding them and commit to adhering to them.
The government, in particular, has outdone itself, having become a world leader on ambush marketing law relating to the Fifa World Cup – striking mortal fear into the soul of anyone who dares to flog so much as a 2010 paper plate that resembles a soccer ball.

But will it fare as well where its own employees and those of state-owned entities are concerned?

By the same token, it is incumbent upon business to respect government regulations that govern gift giving. In the private sector, it may be common practice to shower top clients with extravagant gifts, but companies that try to reward government officials should realise they are simply putting them in the difficult position of having to refuse the gesture. Governance and ethics cannot be separated, and governance without ethics is purely form that lacks substance.

An organisation’s ethics are the established values and principles it uses to inform and conduct its activities. These describe the moral and ethical climate within which the organisation wishes to operate. In the words of Roy Disney, “It’s not hard to make decisions when you know what your values are.”

So, whatever side of the gift you find yourself come June 2010, enjoy the games and the once-in-a-lifetime experience; but remember, there is no such thing as a free lunch.

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