Module 11:  Corruption dilemmas

Dilemma 6:  Entertainment - Answer

The sub-contractor may have made the offer honestly, with no intention of influencing you to improperly favour the sub-contractor in future bids.  There is nothing intrinsically wrong in socialising in a business context.  It is an accepted way of building trust and helping working relationships.

However, the obvious risk in this situation is that it is possible that the free entertainment may be intended to improperly influence a future decision of yours (and therefore is a bribe), or may be perceived by others as a bribe (which is reputationally damaging).  Although the sub-contractor may claim that it is not intending to influence you, you are an important decision maker, and they are spending a lot of money on you.  Why would they be doing that?  It is unlikely that they are making the equivalent offer to junior personnel in your organisation who have no decision making powers.

Therefore, it is very important that you carefully consider whether or not to accept such an invitation.

In particular, is the entertainment sufficiently extravagant that:

  • it could be intended by the sub-contractor as a bribe
  • it could be a corrupting influence on you, in that it could make you feel under some obligation to repay the favour by showing some preference in the future
  • it could be perceived by others as likely to influence you in your future business decisions.  For example:
    • If other sub-contractors were to hear of this sort of entertainment, what impression would they get?  Would they feel that you had been “captured” by this sub-contractor?
    • If you were accused by the police of receiving a bribe, and were to appear in court, how would you defend receiving this hospitality?  Would your defence sound plausible to the court?
    • How would other employees of Buildwell view this hospitality?  It is quite a generous offer, and many of them would like to be in your position going to this football match at someone else’s expense.  Could they be resentful?  Could they start making accusations that you had been “captured”.  How would this affect you pride and prestige?

So, even if an offer of this kind is not intended by the sub-contractor as a bribe, and even if you are sufficiently objective not to be influenced, for all the above reasons it may be preferable if the offer is refused. 

As general guidance:

  • You should not accept or give any form of gift, hospitality or entertainment in a business context which could actually have a corrupting influence, or be perceived as having a corrupting influence. 
  • If you want to meet socially to improve business relations, then do so in a relatively modest way – for example, over lunch where:
    • either each organisation pays its own way,
    • or where one organisation pays but where the bill is modest. 
  • If relatively minor gifts are given by a supplier (e.g. a bottle of wine) then this could be accepted, but be placed in the organisation’s annual charity raffle. 
  • Gifts to be given by the organisation could be something which symbolises the organisation’s product, but which has no marketable value. This should be the case in any country – even in those where there is a strong tradition of business gift giving. 
  • Organisations should adopt a clear gifts policy which specifies the limits of acceptability for giving and receiving gifts and hospitality, and which requires their registration in a register held by the organisation. 
  • Many organisations totally ban all gifts and hospitality in relation to their procurement department.
  • Business partners and clients should be informed of the organisation’s policy where relevant.  This will then minimise the risk of corruption and also of offending business partners.

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January 2025
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