Contractor ethics rules too reactive, compliance focused, experts say

Wednesday - 7/30/2014, 6:21pm EDT

By Stephanie Wasko
Special to Federal News Radio

Improving acquisition compliance and ethics may involve less rule-making and more culture shaping, according to panelists at the National Contract Management Association's World Congress conference.

The Federal Acquisition Regulations (FAR) keeps expanding, and industry has admitted to struggling under the weight, said Lesley Field, acting administrator of the Office of Federal Procurement Policy. She said following the contract regulations proves "difficult for large businesses and impossible for small businesses."

OFPP is reviewing comments from vendors and other interested parties as part of its national dialogue on federal procurement on what policies and regulations could be streamlined, discarded or improved upon.

While agency leaders at NCMA discussed the need to streamline and pursue innovative approaches to federal acquisition policies, a second panel with vendors said the oversight burden is weighing them down.

Compliance and ethics add to the load of requirements for contractors and the regulations are increasing, said Stephen Epstein, chief counsel for the Boeing Company's ethics and compliance, during a panel discussion at the conference Tuesday.

"Every time we add compliance, it's not free," said James Meade, executive director for acquisition and procurement in Office of the Deputy Assistant Secretary of the Navy.

He added increasing the number of regulations does not guarantee a change ethical behavior.

"Contractors are spending all their time trying to comply with the rules as opposed to focusing on the values and making sure we're really getting the values right, and we're teaching people those values, and training them to make the right decisions," said Angela Styles, the co-chairwoman of NCMA's government contracts group, a former OFPP administrator, and now a partner at Crowell and Moring. "It's not easy. You're never going to be able to come up with all the rules."

Instead of Congress continuing to add new rules for companies to follow, panelists said there should be more flexibility for companies to invest time and money into building a culture of trust and honesty.

Alan Chvotkin, senior vice president and general counsel for the Professional Services Council, said the added regulations typically are a result of the changed acquisition environment where agencies are buying services instead of products.

"Many of the regulations that have built up have come because of specific examples that have occurred in the marketplace," Chvotkin said, "Can they be simplified? Absolutely. There are very strong compliance regimes put into place, but on the other hand, there is a fiduciary responsibility that government has to the taxpayer and that companies have back to doing business with the government."

The most difficult problem lies with the government, not industry, according to Styles. She said that the private and public sectors need to work together to train employees how to make ethical decisions.

"It's going to hurt all of us eventually if we don't figure out what is causing these problems," she said.

She also said new culture-shaping methods need to be developed that go further than reminding employees to "stop and think."

Epstein said the private sector provides more specific ethical training to fit certain job descriptions and suggested exploring options for of mobile apps.

"Training should not be a stumbling block," he said, "and it shouldn't be expensive."

Stephanie Wasko is an intern with Federal News Radio.

RELATED STORIES:

GSA cuts 1000 noncompliant vendors from IT schedule

Pentagon cites ethics violations by security chief

Ethics panel: No full probe of McMorris- Rodgers

Recommendations attempt to raise acquisition, cyber consciousness