Buy Lines: Ensure contractor ethics with close attention, not new laws

Stan Soloway

It is often said that good people don't need laws to tell them how to act responsibly, while bad people always look for ways around the law. While we can establish norms of conduct, we cannot legislate behavior.

Just consider a few recent events: the suspensions of WorldCom Inc. and parts of Boeing Co., government contracting officers convicted, Defense Department auditors altering documents, union officials arrested, government employees committing purchase card fraud.

When you look at the list, you might suspect that we are witnessing a wild-west show of historic proportions.

In the government procurement arena, where public funds and services are concerned, it is axiomatic that the government must pay close attention to corporate integrity and ethics.

That attention is piqued by the kinds of high-profile allegations that have emerged recently.

Unfortunately, reactions to such cases are sometimes overly harsh and based on limited information. Lacking other options, congressional remedies too often focus on expanding detection and increasing punishment.

In fact, the multilayered systems to detect and punish violations in government contracting work remarkably well. There is no evidence violations are increasing.

Nonetheless, Rep. Barbara Boxer, D-Calif., in January introduced legislation that would automatically bar from some future defense contracts any company under investigation by an agency inspector general -- flatly ignoring the basic tenets of due process.

After all, few IG investigations result in findings of significant wrongdoing. Special ad-hoc hotlines have been set up for allegations of contract malfeasance, even though numerous agency and company hotlines already exist and work well.

With little evidence, some also argue that the procurement reforms of the last decade have created an overly permissive acquisition environment. But far from diluting accountability, key reforms such as best value selections, share-in-savings, performance-based and award term contracting, and contractor past performance evaluations have improved the competitive process and increased the pressures on companies to promise only what they can deliver, and to deliver what they promise.

Government contractors know they must accept reasonable government oversight and that they will be held accountable for their actions and performance.

They know that even minor transgressions, intentional or not, can be magnified in the public eye and penalized heavily.

Along with federal employees and agencies, government contractors also know they have a central role in earning and retaining the public trust.

This is an appropriate time in which to refocus company attention on that responsibility. It is a responsibility that must be continually communicated to all employees. More than ever, it is important to review and renew business compliance programs and to go the extra mile to ensure that all employees know and adhere to the rules. As recent months have shown, the acquisition oversight system is effective and the penalties for abuse and unethical conduct are, and should be, severe.

Regrettably, in the federal marketplace, as elsewhere, there will always be some who try to find their way around the law.

Fortunately, we have effective systems to detect and punish such wrongdoing. Adding more systems or excessively punitive laws is not the answer, nor is a retreat from the bipartisan procurement progress of the 1990s.

The answer, as always, lies in strong leadership and constant, focused communications that foster cultures of ethical behavior and standards in each institution, which in turn help build public trust. This is a crucial, collective responsibility.

The future of the vital partnership between the public and private sectors will largely depend on how well it is met by all.

Stan Soloway is president of the Professional Services Council; he previously served as deputy undersecretary of defense. His e-mail is

About the Author

Stan Soloway is a former deputy undersecretary of Defense and former president and chief executive officer of the Professional Services Council. He is now the CEO of Celero Strategies.

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