Dilemma 11:  Entertainment - Answer

The risk in this situation is that the gift may be intended to influence a future decision of yours (and therefore be a bribe), or may be perceived by others as a bribe.  On the other hand, the sub-contractor may have made the offer in good faith, with no intention of influencing you or your team to favour the sub-contractor in future bids.  Furthermore, there is nothing intrinsically wrong in socialising in a business context.  It is an important way of building trust and helping working relationships and it is certainly not the case that entertainment is always suspicious.  However, the issue of whether to give or accept entertainment, gifts or hospitality is one of degree and you need to consider whether a gift or hospitality is sufficiently extravagant that:

  • It could be intended as a bribe.

  • It could be a corrupting influence in that it could make you and your team 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 and your team in your future business decisions.  For example, if other tenderers or members of the public were to hear of this sort of entertainment, what impression would they get?  Other tenderers may feel that there is no longer a level playing field.  Members of the public are likely to regard the entertainment as potentially a bribe.

  • It could set an undesirable precedent in your company.  Other employees in your company may be disgruntled that they are not getting similar perks and may start to look for or accept them from other business partners. 

 

So, even if an offer of this kind is not intended as a bribe, for all the above reasons it may be preferable if it is refused.  In general terms, 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 company pays its own way, or where one company 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 company’s annual charity raffle.  Gifts to be given by the company could be something which symbolises the company’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 entertainment.  Each company 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 company.  Business partners and clients should be informed of this policy where relevant.  This will then minimise the risk of corruption and also of offending business partners.