Ethical Business Gift-Giving: When Is a Gift No Longer a Gift?

As providers of a huge number of promotional and business gifts, we loudly advocate giving gifts to employees, customers, and business partners. Nevertheless, we are aware that it is necessary to comply with many laws of gift-giving in business circles. There is no doubt that ethical business endowment plays an important role in strengthening business relationships. A delicious meal with a supplier can help you strike a new deal; a personalized pen given to a customer can instill more confidence in your company.

Sometimes, however, the line between a gift and a “bribe” can become blurred. Accepting gifts, favors, and hospitality can turn an innocent friendly gesture into accusations of unethical or even illegal conduct in your business.

When is a gift no longer a gift?

First, consider what the main purpose of your business gift is. Is its purpose to influence the business relationship or do you want to achieve something more with it? Or is it just a token of gratitude to thank your clients’ for their trust?

What Should You Pay Attention to?

Time is crucial. Are you on the verge of striking a big deal with a customer that would increase your end-of-year bonus by a significant amount? Have you been offered a gift just before or during the tender process? Both giving and accepting gifts for the purpose of concluding a transaction is a criminal offense under the Integrity and Prevention of Corruption Act of the Republic of Slovenia.

Practical example: if a manager looking for a new job offers a senior manager in another company tickets for a football match, would you consider this “gift” an appropriate one? Common sense tells us not to.

Who Are You Giving the Gift to?

Who is the gift for? Giving gifts to certain people, such as civil servants, for example, is often understood as an illegal payment and consequently arouses suspicion. However, definitions of what a public servant is can vary. In many countries, it is difficult to distinguish between an employee of a state-owned enterprise and a member of the government who also works in a state-owned enterprise.

The principle sometimes used to determine the appropriate level of gift-giving is the principle of reciprocity. You need to ask yourself: If I accept an offer, can I offer the same value in return? For example, “If my supplier offers me theater tickets, can I reciprocate the kind gesture?” If the answer is “no,” this can be considered a bribing atte,pt and it is advisable to decline such an advancement.

So how can companies support their staff? Many companies have a zero tolerance approach to giving and receiving gifts. However, this is not always the most practical approach and can mean that employees find themselves in an awkward situation when they have to publicly refuse a gift that is being offered to them.

This is especially true for employees of multinational companies operating in countries where gifting is an important cultural tradition and crucial in building professional relationships, such as donating red envelopes for Chinese New Year. Some companies have therefore decided not to implement a global general ban, but have locally set limits on the value of gifts that can be given or received.

Clear Policy

Employees need guidance on the company’s protocol for giving or receiving gifts. This includes seeking the approval of their leader or someone senior and entering it in the gift register. Sometimes high-value gifts need to be donated to charity or to the company itself. High-value gifts can then be auctioned off at the end of the year to raise funds for charity.

The instructions are usually found in the company’s code of ethics, which outlines the company’s position on gift-giving and receiving. This policy must be consistent with all other aspects of the organization’s ethical program in promoting high standards of honesty and integrity in decision-making and behavior.

So you don’t have to be a Grinch this year. Inform your employees about your company’s gift policy and encourage them to consider the ethical implications before giving out gifts of their own. You can also offer additional support to those who are part of a culture with different gifting norms. This will save both parties the embarrassment and potentially the reputation of your organization as well.