Ethics Whisperer

Monday, January 12, 2009

Incense, Peppermint, Crooked Mankind

The first question is: Why do this?

It is certainly not because I need things to do. It does seem to me that there cannot be many people who have spent more than 35 years providing what is variably called “ethics” or “compliance” advice. I have had the chance to see organizations and executives in serious trouble, in denial about the possibility of being in trouble, and, sometimes, doing the right thing. One thing I have learned is the endeavor of giving ethics-compliance advice is seldom about content. It is mostly about psychology. Specifically, it is mostly about getting people to do what they already think they should do in an environment that punishes correct conduct. So I hope to tell folks a little bit about ethical influence in the coming days and weeks.

Which brings me to topic A. Why all the blather about gifts, meals, entertainment, tickets, flowers, cookies, meals, drawings, free rides and the other dross of corporate life? Surely this stuff is not all that important! Why then do compliance officers spend a good part of their lives answering questions and picking nits about this crap? After a while, compliance officers are actually pummeled into debating dollar limits (per event, per month, per year ……..) and the fine differences between tickets and chocolates. From the viewpoint of corporate conduct, this is all nonsense.

And yet there is absolutely, positively no topic of more importance in compliance. More on this next time.

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  • Great blog! I think the intent for setting rules around gifts was to standardize what may or may not be perceived as a conflict of interest. To draw lines between nominal gift giving and perceived favoritism. It put in writing that accepting outlandish vacation packages from vendors is unacceptable because a gift of that nature could influence business decisions and be seen to others as unethical business.

    The blather really begins where the line is drawn - the limit is $50, what if I get something perishable I can share with others that's worth $52? To help keep our Compliance Officer from "spending a good part of her life answering questions" like this we developed a Decision Tree for employees to use when they have a question about a gift. The Decision Tree takes employees through a series of questions; their answers lead them to a conclusion - they can keep the gift, they can't keep the gift, or if it's more complicated then they should contact someone for help. The Decision Tree "picks nits about this crap" for us and filters out the truly risky business for the Compliance area to focus their time on.

    By Blogger Tia, At January 13, 2009 at 6:56 AM  

  • Well, at the very least the rules need to be simple, w/o exception, and, above all, applied and audited. If you aren't checking, the only compliance you will get is one employees rats out another employee - and this is not a good environment to create!


    By Blogger Mark Pastin, At January 13, 2009 at 9:24 AM  

  • I agree - we set people up for failure if the rules are too complicated to understand. We hoped the Decision Tree would get employees used to thinking through a decision making process for doing the right thing.

    How could we audit the gifts employees (particularly higher level management) might receive from external sources? We ask them every year to disclose this information, but if they don' seems like we're back to relying on employees to rat out each other.

    Or do you think that this shouldn't even be an area of concern at all? What made this important for Compliance Officers in the first place?

    By Blogger Tia, At January 13, 2009 at 11:45 AM  

  • It is the most important and least important of compliance issues - I will explain in later installments. As to audit, expense reports should require documentation of the who, what, when, where and why of an item given - even if no reimbursement is sought. If the gift limit is clear, employees will gleefully report violations by others which sort of closes the circle.

    By Blogger Mark Pastin, At January 13, 2009 at 2:19 PM  

  • Hi! This post couldn't be written any better!
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    He always kept chatting about this. I will forward this write-up to him.
    Pretty sure he will have a good read. Thank you for sharing!

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    By Anonymous Anonymous, At November 13, 2013 at 7:07 AM  

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