Ethics emphasis could be a procurement plus

New congressional eye on accountability should improve contracting environment

Government officials are being careful. After last year’s scandals in Congress helped shift power in the House and Senate, ethics has emerged as a top priority in the new Congress.

More attention to ethical conduct could result in profits flowing to businesses that do not have an inside track to lawmakers and other officials, according to some in the business community.

“When you have ethics, you level the playing field” for businesses, said Scott Orbach, president of EZGSA, based in Bethesda, Md. “When you have no ethics, all the deals go to the same guys.”

Department officials have been watching their step and will consider their actions closely, experts say, especially because Democrats on Capitol Hill are on the lookout for agency abuses. Many congressional leaders have talked about investigating  waste, fraud and abuse. Likewise, senior Bush administration officials have talked a lot about transparency and accountability.

The Office of Management and Budget has touted its own accountability initiatives. For example, on, OMB posts reviews of administration programs and rates them. In a briefing with reporters Feb. 1,

Clay Johnson, OMB’s deputy director for management, said congressional staff members are using the Web site’s assessments to outline oversight agendas. He said he wants to bring issues to light.

“We want to be held accountable,” he said. “We like oversight.”

In a policy letter last October, Paul Denett, administrator of the Office of Federal Procurement Policy, said the government is in a new contracting environment that places much greater reliance on the contractors. “Increasingly, government employees work alongside contractor personnel in a ‘mixed workplace,’ ” he wrote.

Government officials must be vigilant in protecting the integrity of the contracting process in this new environment, Denett added.

“We owe that to the taxpayers and the businesses, small and large, that compete for government contracts,” Denett told senior procurement executives.

The emphasis on ethics in government will not affect the majority of contractors who already follow the rules and regulations, said Doug Larkin, chief executive officer of Larkin Communications. If ethical companies continue on the right path, they have nothing to fear from this new focus, he said.

Ethics adds another dimension to a business’ image, Larkin said. Companies need a history of integrity, he said. He suggested boosting that positive background with actions such as seeking certification from the  International Standards Organization.

“That’ll get you in the door,” Larkin said.

Orbach said most government contractors simply want to tell decision-makers how to solve their departments’ problems. But with more weight on ethics, the door will open to more companies.

“Now that you have the legislative [branch] challenging the executive, the executive has to make sure they are doing the best things for everybody,” Orbach said.

Larkin agreed. “Government more and more is concerned about not giving the appearance of endorsing a company,” he said.

But Phil Kiviat, partner at Guerra Kiviat, disagreed with the notion that an emphasis on ethics will bring more business.

“I would call that wishful thinking,” he said. Upright businesses will not see any differences in government contracting, and attention to ethics will affect lobbyists much more than business owners, he said.

Agency ethics officers may crack down on officials going to events such as charity golf tournaments, but their sensitivity to wrongdoing should keep them from getting into any trouble, Kiviat added.

He predicted that the current close attention to ethics will blow over.

The heightened sense of ethics is a new piece of a business image. Larkin described it simply as: “Do the right thing.”
Is ethics reform par for the course?Major concerns about the appearance of wrongdoing will blow over soon, because most people already pay attention to the rules,
said Phil Kiviat, partner at Guerra Kiviat.

However, the many annual charity events hosted by industry associations and lobbyists could be pinched by a closer scrutiny on ethics. If agency ethics officials become more restrictive about allowing officials to attend them, attendance could falter.

To date, Kiviat said, he has had no indication whether government officials will continue to attend such events.

Nevertheless, new ethics rules may result in less valuable charity tournament prizes.

The golfer with the best round may no longer get a new set of golf clubs, he said, and a box of balls may not be enough to motivate many people to play.

 — Matthew Weigelt

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