Charles Gutjahr

Melbourne, Australia

Aren't all corporate gifts actually bribes?

16 Apr 2014 — a 2 minute read on business

Barry O'Farrell, Premier of New South Wales, announced today that he will resign due to accepting an expensive bottle of wine as a gift and failing to tell yesterday's ICAC hearing about it.

I make no judgement on him, but it did make me wonder why companies give out gifts. Why invite even a whiff of corruption by doing that?

When a gift is a bribe...

I know several people who have received corporate gifts from companies trying to gain or maintain their business. These are relatively small things: tickets to a sporting match, a free dinner and drinks, movies tickets, etc. Those people all accepted the gifts, and apparently didn't consider them to be bribes. There seems to be a widespread acceptance that corporate gifts are a normal and legitimate promotional tool.

But surely most people would consider it to be bribery if a sales rep gives you $100 cash in a private meeting where he touts for business from your employer? So how is it different if a company gives you a $100 sporting ticket in a private email and calls it a 'corporate gift'? I don't see the distinction: for me, a corporate gift is a bribe.

There has been much scorn for the characters appearing at ICAC who gave away expensive corporate gifts; I'd like to see that same public scorn for all corporate gifts.

...and when legitimate promotion

I think the reason we're too accepting of corporate gifts is that people mix them up with legitimate promotion.

When a company promotes itself to you, the primary value you should get out of the promotion is that company selling you a great product or service which helps your business. If the primary value you get out the promotion is the cash value of a gift, then it's a bribe.

My view is:

  • Giving away a free sample of your product to a potential client is legitimate promotion, whereas giving away someone else's product is a bribe
  • Giving away an inexpensive branded item such as a pen is legitimate promotion, whereas giving away a desirable luxury pen is a bribe
  • Giving away an expensive item as a prize in a competition is legitimate promotion, whereas giving away that prize directly to a person of your choosing is a bribe

One thing I hope Australians learn from today's events is: don't associate yourself with the kind of company that thinks it's OK to hand out corporate gifts.