The Procurement Services Department at Indiana University of Pennsylvania (IUP) adopted the Institute for Supply Management (ISM) standards and code of ethics for application in the performance of its fiduciary responsibilities to the university.
The following are the list of standards, guidelines, and principles upon which the IUP Procurement Services Department personnel are bound.
Integrity in Your Decisions and Actions
Value for Your Employer
Loyalty to Your Profession
From these principles are derived the ISM standards of supply management conduct:
A distinguishing characteristic of a profession is that practitioners combine ethical standards with the performance of technical skills. Supply management professionals must subscribe to a set of ethical principles and standards to guide individual and group decisions and actions.
Our ethical principles are integrity, value, and loyalty. From these principles our standards are established to (1) encourage adherence to uncompromising ethical behavior, (2) increase awareness and acceptance of ethical conduct, and (3) emphasize the role of ethics when formulating decisions.
These standards are guidelines for use by all who manage or influence the supply chain. The standards do not supplant an organization’s policies, but are a model for consideration.
Every supply management professional is responsible to strive for acceptance and adherence to these ethical standards. Organizations are encouraged to develop, publish, and enforce an ethics policy that supports these standards. The ethics policy should be shared with all employees, including those outside the supply organization, and with suppliers.
Information contained in this booklet will provide insight for handling difficult day-to-day matters. However, standards and guidelines cannot cover every situation and do not take the place of good judgment or sensitivity to other cultures, laws, customs, and practices. When in doubt, consult with management, professional colleagues ... and, of course, your conscience.
Supply management professionals deal with internal and external customers and suppliers. Interaction and treatment between supply professionals and these constituents must be honest and fair-minded. Avoid actions that appear to, or actually do, diminish ethical conduct. Consequences of a perceived impropriety can be the same as consequences of an actual impropriety.
Recommended guidelines for preventing perceived impropriety:
Supply management professionals must not use their positions to induce another person to provide inappropriate benefits to themselves or others. This includes family, business, personal or financial relationships. Even though a conflict may not technically exist, supply management professionals must avoid the appearance of such a conflict.
Recommended guidelines to avoid and manage conflicts of interest:
Every person in a position to influence a supply decision must avoid any activity that may diminish, or even appear to diminish, the objectivity of the decision-making process. Interests of the employer must be served by those who are a part of the supply process.
Influence is a factor in almost all business decisions. Use care to evaluate the intent and perception of influence on supply management decisions. Clarity can often be gained by asking questions such as:
Sources of influence can be introduced into relationships between buyers and sellers, including:
Guidelines cannot cover every situation and do not take the place of good judgment or sensitivity to other cultures, laws, customs, and practices.
As an agent for the employer, the supply management professional serves the fiduciary and lawful interests of the employer to the exclusion of personal gain. This requires application of sound judgment and consideration of both legal and ethical implications.
Supply management professionals are responsible for developing and maintaining effective business relationships with suppliers and customers. Impartiality across all business interactions and transactions enhances the reputation and good standing of the employer, the supply management profession, and the individual supply professional. Long-term relationships with key suppliers should not prevent establishing appropriate working relationships with other suppliers.
Supply management professionals are in a position to lead and direct the development and integration of sustainability and social responsibility policies and strategies into the business and supply chain. Supply professionals are also in the position to reinforce the importance of personal commitment and how they impact sustainability and social responsibility initiatives and outcomes.
While there are many key and important facets of sustainability and social responsibility, the specific areas of diversity and inclusiveness (supply base and workforce), human rights, and environment are addressed below.
Confidential and proprietary information requires protection and should be shared with others only when needed. Access must meet ethical guidelines, contractual obligations, and government regulations. Supply management professionals should ensure that recipients of confidential and proprietary information know that they have an obligation to protect it.
Reciprocity is both a legal and an ethical issue that may result in legal sanctions against the organization, its management, and/or its supply management personnel.
When supply management professionals or their organizations give preference to suppliers because they are also customers, or when the organization influences a supplier to become a customer, the professional or the organization is engaging in a practice known as reciprocity. Agreements involving a specific commitment to buy in exchange for a specific commitment to sell also constitute reciprocity.
Supply management professionals should develop and maintain an understanding of the legal concepts that govern their activities as agents of their employers in the countries in which they operate. These include laws, regulations, and trade agreements at the international, national, state, provincial, and local levels. In addition, it is common for industries to have unique regulations and laws that supply managers in those fields must comply with.
Competence is expected of supply management professionals. Developing business skills and increasing knowledge of supply management demonstrates a commitment to the profession and positively impacts you, your employer, peers, and suppliers. Professional development requires continuing education.