Therese Anne L. Waban BSA-3 (BA199) April 3, 2023 Mrs. Ophelia G. Paano MINI CASE STUDY “ACCEPTING GIFTS….A CONFLICT OF INTEREST” Villanueva Interior Design Associates is an interior design services firm established by Jose Luis “Tito” Villanueva in 1995, who is one of the preeminent interior designers in the Philippines. The company is engaged in design and conceptualization, and fit-out of interiors for office and residential homes and condominiums; thus, one of the main activities of the firm is to deal with a multitude of material suppliers. Mr. Villanueva received a private message from one of his employees regarding a colleague’s habit of receiving gifts from their suppliers. Upon learning this, he immediately talked to the person involved. The employee narrated that he refused to accept these gifts in the beginning, but suppliers were insistent and started leaving gifts at his house every time a project starts. He also found out that old reliable suppliers complain about the orders that used to be given to them were now given to suppliers giving gifts to the purchasing people. Mr. Villanueva is aware that gift giving has been an ongoing practice in the industry. Questions: 1. Should the employee who reported the incident be protected by management or is it not necessary since the person reported is a peer? Yes, the employee who reported the incident should be protected by the management. There are laws enforced by Equal Employment Opportunity Commission (EEOC) to protect employees from being harassed because they have reported an incident to someone in the company. This is true even if it turns out that the conduct you complained about is not found to be harassment. Each incident report that has been filed should be treated carefully. No employee should ever face punishment for filing an incident report. 2. Would you consider receiving gifts in the workplace as an unethical practice? Yes. When an organization accepts gifts, services, and hospitality, it opens itself up to charges of injustice, prejudice, dishonesty, and even illegal behavior. A company's reputation for "doing business ethically" will be at danger, and commercial relationships may be biased. Accepting gifts in workplace may influence an individual’s decisions and thus may constitute a conflict of interest. 3. Is the reason given by the employee receiving gifts an acceptable justification? Is there a conflict of interest here? A particular conduct led to a conflict of interest. Gift-giving raises potential conflicts of interest because it implausibly or directly urges the recipient to "return the favor." All entertainment, gifts, or favors should be declined by workers participating in a bid process. Moreover, gifts that has the potential to taint an employee's judgment on business decisions involving the interests of the person or organization giving the present. 4. Should Mr. Villanueva create a policy on gift giving or accept this as part of industry practice? Yes, Mr. Villanueva should create a policy on gift giving or accept this as part of industry practice. A gift policy ensures that employees adhere to the company code of conduct in giving or accepting gifts or other such tokens of appreciation. In general, codes of behavior say that all personnel show a commitment to treating all individuals and organizations fairly. 5. Can this be a ground for termination? How will you resolve the issue? An employee, who fails to comply with the standards or violates a company's policy, including not reporting known unethical activities such as gift-giving, will be subject to disciplinary action depending on the gravity of the offense and the company's disciplinary standards. Thus, proper implementation of the gift giving policy must be practiced. This policy ensures that employees accepting presents or other expressions of gratitude, conform to the corporate code of conduct of the business. Today, strict restrictions govern who may offer presents, who can receive them, the value of those gifts, and other elements of gift giving in particular businesses. Yes, gift rules exist to deter bribery, but they also serve to avoid favoritism, conflicts of interest and prevent to tarnish the reputation of the company in the long run.
