My two cents worth...

RHIP-- Rank has its privileges.  If you own a company, you are free to accept darn near anything.  It's entirely up to you as to how you let it influence you.  Still, it would be wise not to let a potential vendor believe he has put you on the hook.

As for employees, you depend on them to make unbiased decisions in your best interests.  You must protect your company from improper influence exerted on employees making decisions for you.  Also, you must set an example.

If the ladies don't find you handsome, they should at least find you handy.

As long as you don't recommend this vendor when he is not the most beneficial, you are doing nothing unethical. However making promises to this vendor is also bad.
Make no guarantees to the vendor and enjoy the game!

While I agree that rank has its privileges, it’s more important to lead by example.

If you accept lavish entertainment then your employees will feel free to also accept lavish gifts.

If nothing it makes your objectivity look questionable. As a consultant you only have your reputation to make your time worth the fees.

I’d keep the giving and accepting of entertainment and gifts within the normal bounds of your industry and location.

As for myself, I would not accept nor give a gift valued more than $25. (Everything I give has my logo on it.) Entertainment is usually limited to normal lunches, supper’s out with drinks are rare. They usually only come on a road trip where I am with another consultant and we will take turns picking up the tab.

Rick Kitson MBA P.Eng

Construction Project Management
From conception to completion
www.kitsonengineering.com

It is a shame that other industries have a more "flexible" approach to this subject. Think of all those Doctors attending lavish conferences in luxurious resorts sponsored by the pharmaceutical companies.... am i missing something? I know they don't place orders but they do prescribe.... do the pharmaceutical companies spend this money just because they like doctors? Witness all the conferences/exhibitions with organised activities for "significant others". Some conferences and exhibitions seem to be a way of being lavish on a grand scale yet avoiding the tricky moral dilemas. I would guess that free-loading at the hospitality suite probably far exceeds the normal allowed limits.
But lets face it, there is no such thing as a free lunch. If your supplier is treating you its because its on your bill somewhere, probably as part of the overheads they allocate. If you don't buy then its on someone elses bill. The best thing is that there is no limit on how much you reward your employees (and here you put the outlay into your overheads and charge your customers!) I am always amazed at the attitude of some managers to their own people. When you reward your workers they feel appreciated. They work better and you get a more profitable business. This comes close to a free lunch.

Jimbo,
Sorry if I stepped on a toe.  One man's view of "orderly" is another man's dictatorship.  

The choice of a forum to post a question in is seldom perfectly clear and unambigious.  Sometimes a person will post a question in an active forum instead of a moribund one that might seem more active (take a look at the BLM (Land) Code Issues forum sometime).  In this case there are 1900 members in Ethics and 1700 in this forum, about a wash.  Had I bothered to look for the "Ethics" forum I probably would have posted my question there, but I posted it here because this is a forum where I recognize many of the people and have had valuable dialog with them.  Most of the same people are in "Ethics".  

I just looked in "Ethics" at Thread765-61387 (that, interestingly enough, you're participating in) that could be argued to have nothing to do with "Ethics", but is a lively and valuable discourse.  It started with a pretty little article about why there are lawyers, evolved quickly into a lengthy discourse on the McDonald's coffee lawsuit, thence to Kraft providing smaller portions, and a porch collapse in Chicago.  

Where's the "Ethics" in that thread and why did you start this censure here (instead of a forum more appropriate for off-topic discourse)?

David

Yes the medical world does seam to have a different view of this issue.

My brother in law is a pharmacist. He runs a pharmacy in a small rural town (population about 1500). He is feted several times a year in ways that are unheard of in the construction and consulting business. For example weekends at luxury resorts with all you can golf eat and drink at least twice a year, cruse vacations and winter getaways for less half price. He has over 50 golf shirts in company names and logo’s, when he supports prizes ($300 leather jackets, the insurance fee  of $500 for a golf cart for a hole in one contest) for the community events the drug companies commonly pick up the tab and he gets the local credit. Educational seminars with luxury meals and a one-hour talk about some new drug that counts as a continuing education credit are a monthly occurrence.

He sees this as perfectly normal.  Doctors and other pharmacists attend these sessions. He feels that his professional ethics to provide the patient with the best care is not compromised by this entertainment. He feels that for him to attend a drug company session he deserves to have a lavish meal with drinks.

Lets just say that in the interests of family relations I have chosen not to comment on this with him. At the least this pushes up drug costs to the patients.

Now consider the last construction product event that you went to. If they are anything like the ones that I have gone to there might be free coffee and donuts and a couple of baseball caps. When I first started working, I was with the federal government; we went to product demonstration and the boss refused to accept a free coffee (I had already poured a cup and got a dirty look for my trouble). We had to leave before the complimentary low-end buffet lunch was served.

There should be a happy medium.  Social entertaining provides much of the grease that keeps the wheels of personal relationships turning. These personal relationships are part and parcel of working in any industry. I am lucky that as a consultant I can reciprocate and it is a tax deduction for me. Some of my clients are not on company expense accounts and have no way to reciprocate except out of their own after tax pocket.

As I said above, I keep it to a low amount and make sure that I often reciprocate with those whose product sales I can influence.

Gifts are only those things with my logo on them and are always under $25. My current offerings are a metal business card case with a calculator in it and some coffee mugs.

I also never really trust a client who acts like it is expected of me to always pick up the tab.  I was once involved with a project that was located about 200 kms from the office of my client, a large consulting firm. Their client, the owner’s representative, would always insist that they stopped at a special ice cream stand on the way back from the job site. He would never make any move to pick up the tab. While it was only a few dollars at a time, it spoke volumes to the way that this person did business.

Rick Kitson MBA P.Eng

Construction Project Management
From conception to completion
www.kitsonengineering.com

If anyone is interested in the resolution of this, I decided that if I drove both the vendor and myself to the game (800 miles round trip), paid for my own room and half the meals, and he provided the tickets then the net "gift" was considerably less than zero and there was no confilict.

David

Thanks for the follow-up.

   I have been employed by at least 3 Large company's. In the Billions per year...Ethics has been a major problem for all of them. Accepting small gifts of $25.00 or less was acceptable, any thing over that was not.
   I for one do not see a problem here. The only reason a vendor, or customer, would give such a healthy gift would be to persuade your "vote", so to speak, in their direction.
   The line is pretty clear if you really look at it unbiased and professionaly. Besides, show by example will earn respect from your employees.

Rob

I would like add the suggestion that we take care not to impose our morality on the rest of the world, or outside of the business world, at any rate.
What we think is improper is an accepted part of other peoples culture.
In some cultures the giving of gifts is an essential part of the etiquete and not to give a present is bad form. In some cultures this "gift" can equate to what we might consider a hefty "bribe".
So while a am in full agreement that within the UK (especially since the Pilkington scandal, or at least, thats what i remember), the US and some other European countries, i would not want to suggest that in some other countries it is in anyway improper. Indeed, in some cases it is expected that such "gifts" form the bulk of the reward for the job.
Think on it, staff in some restaurants probably get more in some tips than we are allowed to give as "gifts" yet there is nothing wrong with that practise. Unless, of course, you are opposed to tipping just to get good service or even when you don't.

Most gift giving by companies seems to be around christmas or other holidays. I avoid this by giving a christmas card with a personal thanks for the work, supplies, assistance, etc throughout the year and wish the person a happy and safe break away from work.

One year I gave my top few clients gifts and received very little in the way of thanks. The card has so far generated 5 telephone calls thanking me for my thoughts and wishing me a happy christmas.

This will obviously not apply to all cultures but it works for me in Australia.


Best wishes to all for christmas.


sc