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In the business world, the line between what is considered acceptable and what is not, in a professional context, can get easily blurred. This is especially true when it comes to the practice of corporate gifting. The way a gift is received can either do wonders for your business or going the opposite route, can prove disastrous for your company.

The opportunities for giving and accepting corporate gifts in Bangalore are plenty, but drawing the line between an appropriate and an inappropriate gift can turn out to be a confusing task. This article will give you some insight into the ethics of corporate gifting and what considerations need to be remembered before you offer or even decide on a corporate gift.

Corporate Gifting

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Let us start with some knowledge on why corporate gifting is needed to run a business.

What is the need for corporate gifting?

Corporate gifting and hospitality can fulfill many needs of a business. Firstly, a corporate gift is a great way to build brand image and instill your company’s name in the mind of your customer.  This is important when you want to establish your position in the market as well as to maintain customer loyalty.

Also, a corporate gift is an excellent tool for building relationships with your current business associates. An appropriate gift given at the right time will create a feeling of goodwill between you and the other person. Corporate gifts are given to employees to boost employee morale in the workplace. It will make an employee feel valued and appreciated thereby strengthening their loyalty to the company.

Corporate gifts serve as a marketing and advertising tool as well. Anyone who comes in contact with the gift will get to know about your company. This can augment your business and earn you more referrals and increase sales.

What are the ethical considerations of corporate gifting?

Even though corporate gifting can serve many purposes and is an integral part of running a profitable business, there are some ethical considerations that you should keep in mind. This will ensure that the gift is received in the spirit that it was intended for and not as a bribe or an untoward influence.

The timing of the Gift

The timing of a gift is of the utmost importance and can make all the difference to how a corporate gift is perceived. A gift given with the intention of pressurizing a client into acting in your favor is not the best idea.

For instance, a corporate gift given at the verge of closing a massive deal with a client would most likely be considered a bribe. The same is the case when a bidding process is going on when a contract is getting renewed, when a promotion is on the cards, or when other negotiations are going on.

Giving corporate gifts to exert undue influence is even punishable under law.

Ask yourself if the timing of the gift is proper, i.e., whether the business would be resumed as usual after giving the gift.  If the timing seems suspicious, wait it out before giving the gift.

Gift Recipients

The appropriateness of the gift also depends on who is receiving the gift. For instance, avoid giving a lavish gift to a person who is your senior in position as this will definitely come off as seeking favor.

Giving gifts to persons in positions of power such as government officials and politicians is also a strict no-no. This will be construed as payment to get your way and can be legal repercussions. It is vital to clearly differentiate between a person who works for the government and someone who works in a state-owned enterprise.

You can determine whether a gift is appropriate is by asking yourself whether the recipient will be able to reciprocate with service of the same value. While giving gifts, make sure you are giving gifts to everyone on the team or department. Restricting your gifts to a particular person will often be a sign of less than noble intentions.

Be careful while gifting to someone of the opposite sex. Make sure the gifts are fitting to the business relationship and stay away from personal items.

Gifting Policy

Most companies have a corporate gifting policy in place for when the situation arises.

Some companies have a zero tolerance approach to corporate gift giving and receiving. It would be an embarrassing scenario should the recipient have to decline your gift.

Inconsistencies in gift giving culture are mostly seen when companies such as MNCs have to operate in countries other than that of their origin. In Japan, for instance, it is customary to give gifts at every business meeting. Keep yourself informed of the cultural traditions related to gift giving and receiving and also determine the value of the gift accordingly.

Corporate gift giving policy might also dictate limits on the value of gifts or the need to obtain approval from senior level management for accepting gifts.

A company’s policy may include provisions to auction off corporate gifts at the end of a fiscal year or donation of all gifts received. The company code of ethics will be a good place to get complete knowledge of all gifting protocol. Or else departments such as marketing, sales, resources, and public affairs that are in direct contact with a client have their own code of conduct regarding gifts.

Develop a clear understanding of the company’s rules. This will warrant that the gift you are giving will serve its intended purpose and reach the desired recipient.

Pricing of the Gift

The money you spend on the gift is obviously another factor to consider when placing a gift order. The value of a gift is a rather subjective issue. What seems like a significant amount to one person may not seem to be so to another. Further, the value can differ from one geographical location to another and from one economy to another.

It is never a good idea to go beyond your means to procure a gift for a business associate. Keep your gifts simple and useful. Spending large amounts of money on gifts will be drawing really close to bribery.

Corporate gifts are also subject to tax deductions. For example, in the USA, any gift that costs upwards of $25 is considered a part of taxable income. Also, the Internal Revenue Service allows business to deduct the cost of any corporate gift that falls below the $75 mark.

The tax deductions on corporate gifts differ from country to country as well as between industries. Usually, intangible gifts such as tickets and subscriptions are not subject to tax deductions whereas tangible gifts such as gift hampers, perfume, wine, stationery, etc. are tax deductible.

Selection of the Gift

Now comes the most important question, i.e., what should you gift to ensure the best results for your business.

Gifts that show Corporate Social Responsibility (CSR) are great ideas. In that vein, gifting a charitable donation on behalf of your client always works. Whenever you gift, make sure that your gift is ethically created and is environment-friendly as far as possible.

Socially responsible gifts will create a positive public image for your company which is critical for creating good business opportunities. They are also less likely to be understood as bribes.

Experience-based gifts such as tickets to a sporting event, dinner reservations, cruise tickets, spa appointments, etc. are also gifting options. Nowadays, gifting memberships for both online and offline classes is also a trend. They will leave a much longer-lasting impression in your client’s minds than material gifts.

With that being said, some gifts that you cannot go wrong with are, food baskets, liquor and wine, office related items, electronics, backpacks, wallets, etc. Anything practical and user-friendly is always preferred.


While running a business, you will invariably be faced with the task of either giving a corporate gift or receiving one. The ethics of corporate gifting is one area that has to be given particular importance so that your gift is received in the right manner and serves its intended purpose.