“You award a supplier a multi-million dollar contract for the main subassembly in your product. As a thank-you the supplier offers you 2 tickets in his company’s skybox for this year’s Super Bowl. If you accept this gift, how does this affect your company’s reputation and what are the potential consequences?” -e-Factor!® scenario
Would you be tempted? I would! This is a good scenario to bring up at the water-cooler to see what your colleagues say. Why? After using this scenario in a workshop I was astounded to hear the variety of opinions on whether this was acceptable or not. The opinions ranged from “Sure – I worked hard to get that supplier on board!” to “Absolutely not! This could be perceived as a bribe and we could lose major customers!” Irrespective of the company policies, everyone had an opinion. Most related to their own personal preferences rather than what was best for the organization. If your company has a policy on accepting gifts, you might want to dust it off and check for clarity.
So what’s the big deal? I mean, it’s just a couple of tickets to a football game, right? Well, not exactly. You can buy a box seat for anywhere from $250 to $500 per seat for a regular game, but for the Super Bowl? Now you’re probably talking a few thousand dollars. So this is not exactly a token gift! So now we’ve got issues of honesty, accountability, and integrity.
So let’s look at this from the various perspectives. If we are a staff member, and we feel we have made a truly made an extraordinary effort this could be seen as a real reward for that extra effort. Especially if we feel we’re under-paid or under-appreciated, this could be a great perk and we would be unlikely to see this as something that’s just “part of the job”. It would be too much of a temptation, especially if we feel we are not being paid fairly or competitively with other companies. We might take this gift without reporting it to the company.
If we are the company, on the other hand, this scenario poses real risks for us. If we are a governmental agency, have government contracts or have a corporate policy that prohibits gift giving or receiving we could lose major customers and revenues if anyone in the organization is caught accepting a gift like this. The value alone makes this situation dangerous for our organizational image. But holding people accountable and enforcing these policies, especially if we are a large organization with thousands of employees, is extremely difficult. We rely on our employees to know the policies, be honest with us and do the “right” things. Including resisting temptations like Super Bowl tickets!
If we’re a prospective supplier, finding out that the winning bidder gave a gift like this could be viewed as favoritism at best or bribery at worst, and that could cause a major public relations mess for the company. At the very least, the supplier would likely not bid another job for the company if they have their own policies against “gift giving”. At worst, this could spark an investigation into your practices and create lawsuits or penalties. If you don’t think this could happen to you, the Fiesta Bowl scandal in Arizona was about this very issue – giving tickets and junkets to politicians. It cost the CEO his job, imposed a $1M penalty and almost cost Arizona the rights to hold a major college championship bowl game in the state. Arizona estimated tourism revenues from all college football games in 2010-2011 were $354.6M. http://aznow.biz/travel/arizona-tourism-industry-packs-economic-punch-billions-yearly This situation could have been disastrous for more than just the Fiesta Bowl organization!
So what can we do to solve this type of issue and ensure that all of us understand what’s acceptable behavior? Here are a few thoughts.
Clear communication is critical. Ensure that we set the appropriate parameters and communicated them clearly. Do we or don’t we allow gifts? If we do, what’s the dollar limit on how much we can give or receive? Are gifts reimbursable by the company? Look at our policy to be sure it is clear about what the organization views to be acceptable behavior.
We might also want to periodically remind everyone connected to the organization, including suppliers and customers, about gift giving and receiving policies and the consequences of violating the policy. Especially if there is a risk that the organization could lose major revenues or be sued if someone is caught violating the policy.
One creative strategy I have heard about for managing the gift policy is to put all gifts received into a company pool. All items in the pool are raffled off to employees, and everyone is eligible to win. This way, it is clear that the gift belongs to the company and we can avoid hints of favoritism or bribery.
You might have other ideas which we’d love to hear about! Write us and tell us what you would do in this situation!