Partner code of conduct: How to keep those you do business with accountable

It’s typical for a company to have its own code of conduct that establishes the company’s culture, including its core values and beliefs, while creating some form of accountability for both the employer and employee. It’s certainly top of mind to make sure that your employees are doing “the right thing.” But how about those other de facto “ambassadors” to your restaurant, hotel or business? I’m referring to the various service providers that you source your food from, that clean your establishment daily, or manage your point of sales system (just to name a few). How can you control how these partners act outside your business?

Well, you can’t… but what you can do is require them to execute a partner code of conduct establishing what’s important to your business and have them represent that they will comply with those terms. A partner code of conduct lays out the various standards that are important to your business, such as various ethical, legal, and communication standards. If your various service providers don’t adhere to these standards, and violate the code, then you can terminate your relationship with them.

Beyond a simple service contract laying out the scope of services they are providing, to what actual “standards” are service providers required to adhere? In a world where it’s becoming commonplace to get your daily news through a Twitter feed, a company’s social consciousness has debatably become more important than the products or services the company is providing. It’s more relevant than ever to not only hold these establishments accountable for what happens inside your establishment, but also what happens outside.

Take, for example, a hotel that promises to make every effort to limit its carbon footprint on the world. Is it the hotel’s responsibility to ensure that its vendors are also adhering to that same pact? Is that even a realistic request? Maybe not, but communicating the hotel’s desire to conduct business consistent with its environmental principles is not only more genuine, but also avoids a potential PR disaster if the vendor commits an act that may publicly embarrass the hotel’s public persona as it relates to the environment.

They often say ignorance is bliss, but how would you feel if you learned that some of your service providers were breaking employment laws in their own companies? Would that affect whether you choose to do business with them? It’s certainly not your responsibility to ensure that the individuals servicing your restaurant are being compensated properly by their own employer. However, sharing your restaurant’s expectation on issues like nondiscrimination, health and safety as well as overtime compensation, ensures consistency between your restaurant and those you choose to do business with.

A partner code of conduct can also communicate how a service provider should handle a situation that may negatively impact your business. This might include directives on a food-safety issue, an injury to a guest or employee, a security breach (including data) or even some other type of unfavorable media coverage of your business. Unless you establish clear procedures on how and when the service provider is to communicate with you during a crisis, you’re relying on their judgment on issues that ultimately can and will affect your bottom-line.

Remember, a simple moment “gone viral” can cripple a business overnight, so it’s vital to have some control over the actions of your service providers. To get started, perform the following exercise:

▪ First, establish the core values of your own business. Really try and figure out what’s important to your restaurant or hotel;

▪ Then, whittle down those values important enough to bestow upon those service providers you work with;

▪ Create a clear and concise document (remember, less is more!) that can be attached to any service agreement as the partner code of conduct.

▪ Finally, keep them accountable!

Corporate and transactional attorney Andrew Cromer is a partner with the full-service boutique law firm of AXS Law Group in Wynwood. He was formerly associate general counsel for Shake Shack in NYC. andrew@axslawgroup.com.