Corporate Ethics & Gift Giving
Corporate ethics can involve complicated areas where both impressions and laws affect business decisions. Giving giving, a common practice by corporations, is one of these areas where companies must pay attention to how a gift to a client may be interpreted. Most large companies have specific policies regarding the giving and receiving of gifts from other businesses.
Other People Are Reading
-
Gifts
-
A gift in the business world is a spontaneous gesture from one business to another (or to different employees in the same business), usually through two contacts from either business. Gifts can take many forms, from monetary donations to gift certificates and objects such as food. Gifts are defined largely by their independence. A gift is not given as part of a program or as an agreement between two people--this is known as an incentive, which is more typical between employer and employees.
Company Policies
-
Company policies governing gift giving are typically very specific so that those in marketing and business relations understand their boundaries. Some business industries have a complete ban on gifts. These businesses, such as insurance companies, retail stores and medical centers, cannot afford to have any gift resemble a bribe in any way and simply refuse to accept them. Other businesses limit the value of the gifts they give or receive, and the situations in which gifts can be given.
-
Improper Gifts
-
Gifts should never be offered during a bidding process, even if the bidding falls during a holiday event such as a Christmas function or Independence Day barbecue. These are always seen as bribes, and in general gifts should not be given to a company if the business is still in negotiations over a contract or offer. Expensive gifts such as cars should also be avoided, especially when offered to executives. Businesses giving gifts can use company policy as a guideline, but should also avoid giving the wrong impression.
Giving Practices
-
Gifts should be given on appropriate occasions, such as at holidays, and should always mirror the type of relationship the businesses have. A long-term client may deserve a more personal or expensive gift than a new client. Gifts should match the styles and tastes of the client, but also be within the proper bounds of a business relationship. Personal touches such as a written card can often create a favorable impression no matter the cost of the gift itself.
Taxes
-
The Internal Revenue Service allows businesses to deduct a business gift costing up to $75, which provides many companies with a useful rule when money is spent on gifts. However, typically gifts over $25 count as taxable income when given to employees, so most in-business gifts fall below this amount.
-
References
- Photo Credit Corporate Building image by FJ Medrano from Fotolia.com
