Common Management Admission Test (CMAT) Practice Exam

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What do policies regarding accepting gifts from suppliers aim to achieve?

Increase supplier relationships
Avoid the perceptions of impropriety
Enhance competitiveness
Encourage gift exchanges

The correct answer is: Avoid the perceptions of impropriety

Policies regarding accepting gifts from suppliers aim to maintain ethical standards and prevent any conflicts of interest or appearance of impropriety in business relationships. These policies help ensure that decisions are made based on merit and objective criteria rather than personal gains, which could arise from accepting gifts. By establishing clear guidelines, organizations can foster a culture of integrity and transparency, reassuring stakeholders that the interests of the organization remain uncompromised. While strengthening supplier relationships, enhancing competitiveness, or encouraging gift exchanges might seem beneficial in a business context, they can inadvertently lead to favoritism, bias, or ethical dilemmas. Therefore, avoiding the perception of impropriety is crucial in maintaining trust and protecting the organization's reputation in the marketplace.