Situation

A customer accidentally sends you a purchase order intended for a competitor. What should you do with the information you learn?

Guidance

Return it at once, as you would with mail that does not belong to you. Do not act on information in any document received in error and do not forward the document to anyone else. Document that you received and returned the purchase order, and let the sender know that you received it by mistake. If the purchase order was delivered by email, delete it from your mailbox, sent folder, and trash folder.

Situation

Your business unit enters into a confidentiality agreement with a customer, after which the customer sends a Request for Quotation. At the same time, Avery Dennison’s corporate office retains the services of an external consultant to develop a long-term strategy for your business unit. The consultant asks you for a copy of the Request for Quotation. The consultant insists on receiving a copy of the quotation, referring to many occasions in which it had received third party confidential information from Avery Dennison business units to complete its work. The consultant also refers to its own obligations of confidentiality to Avery Dennison. You decline to give the consultant the quotation because of your business unit’s confidentiality obligations.

Guidance

You handled the matter appropriately. First, the situations in which the consultant had access to third party confidential information it had received from Avery Dennison were based on express authorizations by those third parties. These authorizations allowed Avery Dennison to share the information with its external advisors. But in this case, the customer’s confidentiality agreement would not allow the transfer of confidential information to the consultant. The matter was resolved by seeking an amendment of the confidentiality agreement with the customer to allow the business unit to share the information with the consultant.

Situation

Your business unit finds it necessary to increase prices due to price increases by several of its suppliers. Your unit lost business after raising its prices in the past, so you would like to test how the market would react to a price increase before implementing it. Your aim is to see if you could learn from customers, following the announcement of a possible increase, whether competitors would follow suit and increase their prices. Is this permissible?

Guidance

This may be viewed as “price signaling” to your competitors: you give a signal, and competitors accept the signal and behave likewise. This activity can be deemed to be price fixing, which is prohibited by antitrust laws. Although there may be reasons or arguments for implementing such a process, it is generally unwise. Check with the Law Department before adopting any such strategy.

Situation

Your key contact at a customer/competitor sends you an email: “We’re really looking to increase our sales in X segment. It’s key for us. I understand your other business unit is coming out with a new product in X segment. If you want to keep your business with us, I recommend you pass along word to the other division to stand down.” What should you do?

Guidance

Tell the customer/competitor that the other business unit will make its own decision about whether to go to market with the new product, and you can only talk about your business with the customer/competitor. Make sure not to do or say anything to suggest that Avery Dennison would enter into any sort of agreement or “quid pro quo” arrangement around the new product and the customer/competitor’s other business. In addition, report the interaction immediately to the Law Department.

Situation

You are expanding business in a country where contacts matter and you are contemplating hiring a consultant to “open doors” and make introductions to government officials. Is there anything wrong with this?

Guidance

When hiring consultants, due diligence needs to be conducted to ensure that the consultant holds the necessary qualifications and experience, is not asking for abnormally exorbitant fees, and has no connection with government or government-related organizations. Consultants hired purely to “open doors” and make introductions could raise potential bribery concerns. Consult with the Law Department prior to hiring any such consultant.

Situation

Your business unit just completed a major capital investment project involving various government authorities. The completion date is close to a big festival in your country where it is customary for business people to take customers and other business associates out to celebrate. Since the project ran smoothly and was successful, you are considering a dinner to express gratitude toward the government officials involved with the project. Should you do so?

Guidance

Where entertainment of government officials is concerned, you must consider whether the entertainment potentially violates anti-bribery laws. In this case, since the project is complete and no pending approvals or permits are required, the business unit would gain no benefit by entertaining the government officials. If the entertainment of government officials occurs during periods when it is customary in the country for such entertainment to take place, it may be acceptable under local anti-bribery laws. Nevertheless, it is important to consult the Law Department before you proceed.

Situation

An Avery Dennison business unit operates in a bonded zone. Customs approval is required for all movement of goods in and out of the zone. Local law requires the company to provide the customs official either accommodation or transport and meals. The local customs official asks for a cash allowance for transport and meals, as allowed by local regulations. Can you provide the cash allowance?

Guidance

Under the U.S. Foreign Corrupt Practices Act and other anti-bribery laws, extra care and caution are required when dealing with government officials. Although it may be permissible to provide customs officials with transport and meals (in kind), it is not permissible to provide them with cash or cash coupons such as those for fuel. You should consult the Law Department to determine whether a pickup service and meals at the company cafeteria would be more acceptable. If the Law Department determines the costs are appropriate, it is important to ensure the costs are properly recorded to reflect that they have been provided to customs officials.

Situation

Your employee’s spouse is selling products to the company. The products are sold at a competitive price and the company likes the product. In fact, the employee’s spouse provides the product more economically and efficiently than any other potential supplier. This relationship was undertaken without your knowledge or the approval of anyone other than the local purchasing manager. Is there anything wrong with this?

Guidance

The fact that this relationship was not appropriately disclosed to management at the start of the relationship is a breach of our conflict of interest policy. The approval should have been sought from a higher level, with the employee and the local purchasing manager excluded from the decision process.

Situation

Your employee wins election to a local planning commission in a small town where Avery Dennison operates. The employee informs you. As her supervisor, and wanting to support the employee’s commitment to the local community, you approve. Was this proper?

Guidance

No. You should have consulted with Human Resources and the Law Department prior to giving your approval. An unavoidable conflict of interest may exist, given the nature of the elected position. There may be occasions in which Avery Dennison’s property interests differ from the municipality’s plans, and the employee’s duties and obligations would be divided. The employee would also be placed in the difficult position of knowing confidential information from both Avery Dennison and the town.

Situation

One of your managers owns an apartment that he wishes to lease. The manager becomes aware that Human Resources is looking to lease apartments for staff who travel to the area and need temporary housing. Human Resources determines that Avery Dennison should lease the property, and a three-year lease consistent with market rates is signed. Although Human Resources is aware of the situation, you, the manager’s supervisor, did not approve the arrangement. The manager further instructs his colleagues in the Finance Department to have the company hold the monthly rental payments, and then make payments on his behalf for personal expenses incurred. The colleagues agree to do this as a favor to the manager. Is any of this activity improper?

Guidance

This is clearly a conflict of interest situation. Although the rental agreement was in line with market rates, and Human Resources, as well as others, were aware the apartment belonged to him, the manager was required to disclose the situation to you and secure your approval. In addition, it was wrong for the manager to ask colleagues in the Finance Department to handle payment of his personal expenses. The colleagues should have refused and reported the request.

Situation

After Avery Dennison hires a company to manage its manufacturing waste at a certain location, you realize that scrap is increasing gradually, yet substantially. You suspect that the vendor is paying operators to generate extra scrap to sell on the black market. You consider various options, including hiring a private investigator, terminating the relationship with the vendor and all the employees involved, talking to the employees and the vendor and cautioning them to stop this behavior, or reporting the situation to the Law Department or the Business Conduct GuideLine. What should you do?

Guidance

It would be wrong for you to take any direct action without checking first with your Group Ethics Counsel or business unit counsel. Company policy requires all investigations to be directed by the Law Department. Besides the legal implications of an improper investigation, there are issues around termination of employees and termination of a vendor relationship, as well as possible criminal charges and other legal actions against the vendor and employees. These must be directed by the Law Department and not by the plant leadership or an external investigator.

Situation

A supplier provides a service to your business unit in a particular country but instructs you to transmit payment to a bank account in another country. Is there any harm in doing so?

Guidance

There might be. This supplier may be requesting payment in another jurisdiction to avoid taxes. Consult with the Law Department so that the situation can be examined more closely.

Situation

Due to certain restrictions on importing goods from Country A, Avery Dennison has provided assurance to a certain customer that we would not sell them goods manufactured in Country A. However, a shortage of product occurs and Country A is the only Avery Dennison location with a surplus of product. You learn that a sales representative, without consulting with the customer, decided that it is more important to satisfy the customer’s order and delivered the products to the customer from Country A. He concealed this fact from the customer and instructed the customer service clerk to falsify customs documentation, indicating that the product came from another country. Do you have any responsibility to report this?

Guidance

By falsifying documentation, the sales representative breached the Code of Conduct and the agreement with the customer. There could be significant implications to the customer, who is responsible for importing the goods into its country. You must report this matter to the Law Department.

Situation

In the situation described above, customs officials randomly open the container and find the associated documentation is not from the product’s disclosed country of origin. The customs agency investigates and sends a letter to Avery Dennison seeking clarification. The letter goes to the sales representative who originally concealed the information, and he decides to handle the request without consulting his supervisor. He writes to the customs officials on behalf of the company, again falsifying information. Is this likely to settle the situation?

Guidance

The sales representative made a bad situation worse. He should have advised his supervisor and brought the situation to the attention of the Law Department. Before investigating or resolving a potential violation, employees must contact either the Law Department or the Business Conduct GuideLine.

Situation

You overhear comments from another employee about being “sick of this place” and perhaps doing damage to company property. The complainer is prone to making gruff, unusual statements. Because of his reputation, you are inclined to overlook his comments as simply his way of venting. What, if anything, should you do?

Guidance

Any comment that mentions causing harm to company personnel or property must be taken seriously, and should be reported immediately to a supervisor, Human Resources or Environment, Health and Safety. You should not try to interpret the comments or the intentions in making them.

Situation

You become aware of a significant adverse health reaction or safety concern associated with one of the company’s products. Do you have any responsibility to report it?

Guidance

If you become aware of such a concern, refer the matter immediately to your product compliance representative.

Situation

A large distributor for Avery Dennison learns of a rebate program that we have in place with one of our end users. The program is confidential and, although most sales go through this particular distributor, the end user is not limited to purchasing our products from the distributor. The distributor contacts you as the local Avery Dennison sales representative and demands that it receive the rebate payment and that it will “handle things from there” with the end user. What should you do?

Guidance

We have a legal and ethical obligation to fulfill the terms of the rebate program with the end user, which means maintaining the program’s confidentiality. You should try to determine how the distributor learned of the rebate program, but you should not discuss details of the program with the distributor. You should also inform senior management and the Law Department of the breach of confidentiality. The end user may also have to be notified. Our company cannot comply with this request to redirect the rebate to the distributor. Doing so would breach the end user’s contractual right to the rebate, and would have the effect of making the end user buy exclusively from this particular distributor.

Situation

Avery Dennison has several competing distributors in a large city. After losing a bid on a significant job, one of the largest distributors contacts its local Avery Dennison sales representative to complain about “undercutting on price” on the lost job. The large distributor pointedly tells you, the local representative, that it has been a long-time customer and wants more favorable pricing than other distributors receive. Should the request be granted?

Guidance

You should not discuss with this distributor the pricing we provide to other distributors because of antitrust and other laws governing such relationships. However, there are legal exceptions to this rule, such as volume rebates that are generally available. Contact the Law Department to determine whether any of these exceptions may apply.

Situation

A customer asks you to certify that our products comply with all applicable environmental, health and safety laws and regulations, and that they meet the specifications related to customers’ restricted substances. Should you sign such a certification?

Guidance

Only sign the certificate if you are the individual responsible for performing the appropriate due diligence to ensure such compliance. This may include obtaining the necessary certifications signed by our suppliers, reviewing Material Safety Data Sheets for all chemicals contained in the final product, and/or testing the product at an analytical laboratory. The level of verification performed as part of the due diligence must be specified on the signed certification or mentioned separately in a cover letter, and must be approved by the group’s product compliance manager and legal counsel before communicating back to the customer. The product compliance manager must maintain all records of communications with customers on product compliance.

Situation

You are notified by a customer that a product poses a health hazard. What should you do?

Guidance

You must report it immediately to your product compliance representative and the Law Department. If you are the first point of contact with the customer regarding an issue, do not resolve the matter on your own. Instead, communicate to the customer that Avery Dennison takes regulatory compliance and adherence to customers’ requirements very seriously, and all product safety-related matters are promptly directed to product compliance, who will then respond to the customer.

Situation

Your employee calls the Business Conduct GuideLine to report mistreatment by his supervisors. The Law Department and Human Resources conduct an investigation. Many employees from your department are interviewed, and the conclusions show that the caller himself has behaved inappropriately, mistreating his direct reports and not respecting colleagues and supervisors. Knowing the results of the investigation, you want to terminate the caller’s employment with Avery Dennison. However, the employee did call the Business Conduct GuideLine, so his termination could be perceived by him, and by your organization, as retaliation for having made the call. What can you do?

Guidance

Although it is true that there were performance and behavior issues that may justify terminating the employee, his call to the Business Conduct Guideline makes the situation more complex. Employees must feel free to speak up, knowing that they will not face retaliation for calling the GuideLine. The Group Ethics Counsel would escalate the case to the Chief Compliance Officer and the General Counsel. If there is certainty that the termination was not a direct consequence of the employee’s call to the GuideLine and that there were other valid reasons, the termination may be allowed to proceed.

Situation

Your business unit has, with the help of an advertising agency, developed binders that display photographs made by external professionals. The advertising agency modified the photos, but they are still very recognizable, so the photographers could claim violation of their copyrights. What should you do?

Guidance

Your business unit should have obtained permission from the original photographers to use their photos. If it is too late to seek permission, the binders should not be used.

Situation

A customer asks that you provide two sets of invoices, one with the actual price and quantity of goods and one with a lower price or quantity. The customer says that he needs the lower value invoice for customs submission so that he can pay lower duties. He says Avery Dennison does not lose out and that he will be happy, so it looks like a win/win situation for all concerned. Should you honor this request?

Guidance

No. Helping a third party do something illegal violates our Code of Conduct and may subject the company to serious penalties and the individual to disciplinary action, up to and including termination.

Situation

One of your employees says he is not sure a certain action is entirely consistent with our values, but says he knows for a fact our competitor does it so we need to do it to compete. What should you do?

Guidance

Gray areas may exist in the minds of employees when faced with a perceived conflict between what the employee knows to be consistent with Avery Dennison values and what the employee perceives is necessary to be competitive. For example, employees may be tempted to engage in “competitive research” by misrepresenting themselves in order to gain information. Or they may over-promise with regard to the performance of a product, without really knowing whether the product can perform as promised, because they believe a competitor does so. Or they may entertain a request to issue multiple invoices, because they believe our competitors do the same thing. Where there is a perceived trade-off between being competitive and being ethical, urge the employee to seek guidance from the appropriate Group Ethics Counsel or business unit counsel.