Skip to main content

Alexey Ivanov/Getty Images/iStockphoto

A $100 bottle of wine arrives at your desk just before Christmas, a sparkly ribbon encircling the neck. It's from a supplier, addressed to you. What should you do?

Beware. Be very aware.

Gifts may be given with the best of intentions – Christmas cheer and all the rest – but many companies from both the public and private sectors are careful to try to determine whether a gift constitutes kindness or an attempt to influence. ("Hope we can do business in 2013," the note around the bottle might read.)

"More and more, companies are toeing the line on gifts from suppliers and vendors," says Catherine MacEwan, director of human resources for the Toronto and Region Conservation Authority.

Sometimes the line between kindness and buying favours is a thin one. "It's all about conflict of interest, because some gifts are made to influence, to put it bluntly," Ms. MacEwan says. "People talk about gifts being made to build relationships, but the relationship is usually one-sided."

In a recent survey by tax and business consultants UHY Advisors, 32 per cent of respondents said a gift would influence their decisions.

No organization, whether it's a regulatory one like the Conservation Authority or a widget maker, should be without a gift policy, Ms. MacEwan says. Such policies guard against conflicts of interest but also against the mere perception of a conflict, which can damage a company's reputation.

"Even if the employee is making very objective decisions about what this vendor is doing, there is always going to be that: 'Did you know this person gets regular [Toronto] Raptors tickets?'" she said.

One day, a large hamper appeared at the doorstep of the Authority, celebrating the birth of a baby of one of its planners. The basket came from someone looking for regulatory approval. The hamper was eventually given to a home for battered women.

"We try to discourage people, but sometimes they send the stuff anyway," Ms. MacEwan said. "If it's something like a box of chocolates, we just leave it open in our front lobby and everybody can have some."

Employees at an Alberta oil patch company felt some discomfort years ago when some employees received belt buckles and mugs inscribed with the logo of a firm that was competing with another supplier, recalls independent human relations consultant Martin Birt, who is based in Toronto.

The employees who accepted the items didn't get into any trouble, he said. But they weren't allowed to wear them at work. This was in a small Alberta town, where everybody knew everybody, and the appearance of favoritism had to be considered.

Some companies set policies to maintain good supplier and vendor relationships. GE Energy, based in Atlanta, reminds its suppliers that they should not send gifts to any employees. "Reasonable" business meals during a meeting may be accepted, but only if they are infrequent and not lavish.

"Gifts from our suppliers are inappropriate and can be construed inappropriately, however unintentionally, and lead to misunderstanding and embarrassment," the company policy states. The firm threatens to disqualify a supplier who disregards the policy.

Managers should ask themselves questions, such as: How would things be viewed in the pages of a national newspaper? Can the gift be reciprocated? Would you be embarrassed in front of your grandmother?

"If it's open and transparent and the whole world can see it, I think it's better than: 'I'm going to take you and your wife to the Bahamas for the next week because we're going to have a conference,' but there is no conference," Ms. MacEwan says.

Companies doing business in Asia face more complicated issues. In China, a manager who refuses to accept a gift from a business contact runs the risk of the other party losing face – and perhaps a contract.

Back in Canada, Mr. Birt says companies in doubt should update their policies regularly and have a reporting system in place where the employee may seek advice from a manager if she has questions about the appropriateness of a gift. Education is key, he says.

"If it's going to work, you have to educate your people in the organization," Mr. Birt says. "They're the ones acting it out in the business world.'"

So, would a nice bottle of wine with a sparkly ribbon pass muster?

"I'm one of those slippery-slope people," Mr. Birt says. "If you shrug your shoulders and say: 'Oh golly, it's Christmas – let's let this one go.' But no. I think that's inappropriate. If you've got a line drawn in the sand, you've got to stick to it."