e-Ethics SEPTEMBER 2003
Free Pass or Sales Pitch?
Vendor Relations at the Ol' Ball Park
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A s director of the cardiac
catheterization department at Osler
Hospital, Don Wrigley purchases
products and services for the cath
lab. Competition for sales can be
fierce, and numerous vendors vie
for Don's attention. The lab purchases
its catheters from DependaCath
because that company's products
are reliable and affordable. Recently
a sales representative from the
Hotwires Company has been aggressively
pursuing the lab's business.
Today Don received a call from
the sales rep, inviting him to attend
a Cubs game as his guest in the
Hotwires skybox. Don has some
qualms about accepting this invitation
from a vendor, but surely
attending the game will not affect
his purchasing decisions. Besides,
how could he pass up this opportunity
when the Cubs are fighting for
the pennant?
Discussion
What ethical harm is there in
attending a baseball game? Sales
efforts commonly involve "business"
outings of this sort. Yet Don's
hesitance, however momentary, signals
that there is more to this offer
than meets the naïve moral eye.
Perhaps coworkers will see his
opportunity as a "perq" that is not
available to them. Attending the
game might seem a personal benefit
that he reaps, perhaps inappropriately,
from participating in a business
negotiation on behalf of the
hospital. It might be perceived as a
"reward" for entertaining the vendor's
sales pitch, especially if
Hotwires subsequently gets the contract.
And even if Don is impervious
to subliminal influence on his business
judgment, as he seems to
believe, the question of such influence
is legitimate. (Studies show,
for example, that physicians who
receive gifts from pharmaceutical
companies tend to prescribe those
companies' drugs more frequently.)
1
Increasingly, healthcare organizations
recognize that ethical pitfalls
beset their relationships with vendor
organizations, and relationships
between the individuals representing
them and the would-be vendors.
If Osler Hospital were an Advocate
Health Care site, a growing array of
resources could help Don Wrigley
think through the questions the vendor's
invitation raises.
In 2002 Advocate's Board of
Directors recognized that Advocate
should address ethical concerns
posed by relationships with vendors—
all who sell (or wish to sell)
products or services to Advocate
entities. Following its "Moral
Community" process, through which
it identifies significant ethical issues
affecting Advocate, the Board commissioned
a task force to develop a
comprehensive approach to ethics in
vendor relationships.
The task force's report found that:
Vendor relationships have vital ethical
significance and should be
shaped by Advocate's Mission, Values
and Philosophy.
Particularly in an organization of
Advocate's size, vendor relationships
are complex, span diverse interests,
and require practical flexibility.
Vendors merit respect as moral
agents and deserve a clear statement
of Advocate's ethical stance
and expectations.
Vendor relationships are of special
concern in four areas of Advocate's
activity: purchasing, philanthropy,
medical education, and research.
The task force proposed an ethical
framework to address concerns
within the four key areas.
Subsequently an implementation
group, including leaders in each
area, revised and significantly
expanded draft vendor relations
guidelines previously developed
within Supply Chain Management.
The resulting "Advocate Health Care
Guidelines for Vendor Relations"
2
provide direction to all who represent
Advocate in vendor relationships:
Board members, senior executives,
all other associates, affiliated
physicians, and volunteers. Not
least, the Guidelines apply to vendor
organizations and their agents.
For Advocate, the Guidelines
contend, "moral consistency"
demands that "our internal and
external relationships unambiguously
respect the character of our mission
. . . and the specific content of
our values." Thus "the integrity of
our faith-based enterprise rests on
our willingness and ability to conduct
our affairs accordingly and to
insist that those who would associate with us acknowledge and incorporate
our preferred ethical standards in
their dealings with us."
After this statement follow guidelines
for all associates; guidelines for those
specifically engaged in purchasing, philanthropy,
medical education, and research;
and guidelines for vendors themselves.
Advocate's "Code of Business Conduct"
and "Conflict of Interest" policies are
cross-referenced frequently.
The Guidelines would address Don
Wrigley's invitation from several angles.
First, they preclude acceptance of "gifts,
favors, services, entertainment (e.g.,
sporting events)," etc. with a value
above $100. Since the value of a skybox
seat probably exceeds $100, Don may
not accept the invitation. And even if its
value were "nominal" (under $100), the
Guidelines stipulate that such a gift may
be accepted only if it is shared with the
recipient's entire staff—hardly a possibility
with the skybox invitation.
One might object that the Code of
Business Conduct does permit acceptance
of a gift valued at over $100, and
requires only that it be reported. (The
Code also requires that the offer itself be
reported—even if declined.) But the
Code prohibits receipt of any "item of
value" that may affect Advocate-related
judgments or actions. Arguably, the
Code should lead Don to decline the
invitation, since accepting it might at
some level affect—or be perceived as
affecting—his purchasing judgment.
Under the Guidelines, Don could
have legitimate business reasons to
accompany a vendor's representative in
certain activities (e.g., travel to showcase
sites) if he pays his own expenses,
then is reimbursed by Advocate. A
supervisor or other authorized person
would have to pre-approve the activity.
But it is doubtful that Don's invitation
truly fits this category. The pivotal question
is whether a specific business purpose
would be served by this activity.
Would actual work beneficial to
Advocate—presumably, something
more than "bonding" with the Hotwires
representative—be accomplished?
Were Hotwires a prospective
Advocate vendor, the company and its
sales staff would receive the Guidelines.
They would see what Advocate expects
of them (e.g., the $100 ceiling on offering
gifts and favors), and what Advocate
expects of its own representatives. Don's
skybox invitation would likely be shelved.
As it is—especially in an Advocate
context—it seems best that Don watch
the game from the "friendly confines" of
his TV room. Both he and Advocate
would then avoid the consequences of an
uneasy commingling of business and
pleasure.
1. See Ashley Wazana, "Gifts to Physicians from
the Pharmaceutical Industry: Is a Gift Ever Just
a Gift?" JAMA 283, no. 3 (19 January 2000):
373-380.
2. The "Guidelines for Vendor Relations" are cur-rently
available through a link on the Advocate
Online home page. They may also be found on
the "Ethics and Institutional Review Board"
page. An additional program of dissemination
and education for key audiences is under way.
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