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Code of Ethics - FAQs
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Frequently Asked Questions

Q: What is the SCIP Code of Ethics and what does it mean?

A: The SCIP Code of Ethics is a set of guidelines for ethical behavior for CI companies and practitioners which SCIP expects its members (and third parties hired by its members) to adhere to. The Code is not a corporate policy; rather the Code contains guidelines by which companies and practitioners can set their own standards along the ethical spectrum.

 

Q: How does competitive intelligence differ from corporate spying?

A: Competitive intelligence is the process of legally and ethically gathering and analyzing information about competitors and the industries in which they operate in order to help your organization make better decisions and reach its goals.  It should be done within the ethical boundaries established by SCIP, your organization, and your personal standards.  Corporate spying often implies illegal activities, such as bribing or hiring employees to divulge confidential information.   

 

Q: I've seen news reports discussing a private investigator researching a particular company. They're doing their investigation using the standard online sources, but they also looked at files that had been discarded by the company. Is this a proper activity?

A: Using confidential information that has been discarded by a competitor, regardless of how it was obtained, may raise ethical questions. Confidential information obtained in an illegal manner is a clear violation of SCIP's Code.  In practice, using a competitor's confidential information would violate most organization's code of conduct.  You may want to apply the "red face" test to this and similar situations; i.e., how would the company feel if this behavior was attributed to them in a newspaper?

 

Q: The Wall Street Journal reports that employees frequently call their competitors and pose as a customer or a student to seek information. Is this a valid activity?

A: SCIP's Code expects that its members must accurately disclose all relevant information, including one's identity and organization, prior to all interviews.  Depending on the jurisdiction, this type of misrepresentation may be illegal.   

 

Q: Is mystery shopping ethical in the retail space or any space?

A: As long as it complies with all applicable laws, most companies do not consider mystery shopping unethical, provided it does not violate any retailer-specific regulations (such as no photography).

 

Q: What about a report of a company buying or otherwise obtaining a password to a competitor's site and researching its pricing structure and offerings?

A: Obtaining a password to a competitor's site without authorization, for any reason, is illegal and therefore violates SCIP's Code of Ethics.  Illegal activity also violates most organization's internal code of conduct.

 

Q: Can I hire private investigators to research principals of a company?

A: It is permissible and even advisable to create a business profile of the principals of competitor organizations. While this practice itself is ethical and legal, it should begin with the wealth of information that is available in the public domain (e.g., interviews, speeches, articles, etc.) Using a private investigator or consultant to uncover additional information is ethical and legal, providing that they follow your firm's corporate code of conduct, the SCIP Code, and all applicable local laws.

 

Q: Can I hire a firm to tap phone calls of competitors?

A: Tapping phone calls is a serious crime in many countries and is prohibited for any reason.

 

Q: Can I receive confidential records at a trade show or by any other means?

A: Receipt of confidential records at a trade show or by other means may raise legal questions.  If such information is received, it should be turned over to your management or legal staff with an explanation of the circumstances under which it was obtained.

 

Q: How does one research patents filed by competitors across an industry spectrum?

A: There are a variety of patent searching services available that can be used to look for patents.  Patents are public records, and as such are expected to be reviewed by competitors.  This can be done yourself, or by specialists who are trained to use the services and know what they're looking for.

 

Q: What does it mean when firms hire former government operatives to direct their intelligence operations?

A: Firms hire former government operatives because they want someone experienced in the intelligence process. Legal and ethical guidelines apply to all employees and contracted personnel, irrespective of their background.

 

Q: What is the difference between corporate intelligence and business intelligence?

A: Competitive intelligence is the process of legally and ethically gathering and analyzing information about competitors and the industries in which they operate in order to help your organization make better decisions and reach its goals.  Corporate intelligence, business intelligence, market intelligence, and other similar terms are often used interchangeably, and more often than not any difference between them is one of semantics more than substance.

 

Q: How do corporate attorneys explain competitive intelligence in their codes of conduct?

A: Corporate attorneys, sometimes in combination with ethics and compliance staff, often develop a code of conduct for the overall organization. Corporate attorneys should be familiar with what CI teams do and how they do it, and there should be a close working relationship between the CI teams and corporate attorneys.  The two groups should work together to understand the business value of competitive intelligence, and to assist with developing and updating language that appropriately balances the risks and benefits of competitive intelligence activities for the organization.

 

Q: Is it permissible to post a job that you don't have any intention of filling because you know employees from competitor companies will apply, and can you apply for jobs at competitor companies that you have no intention of taking in order to learn about the competitor?

A: These activities would be considered unethical by most CI practitioners and may violate your organization's code of conduct and local laws.  They should be avoided.   

 

Q: What are the limitations regarding information you can get from newly-hired employees that used to work at a competitor?

A: Employees who formerly worked for competitors can be valuable sources of competitive intelligence.   However, employees owe a duty of confidentiality to their former employers.  Therefore, before you interview employee(s) who previously worked for a competitor, you should inform them that you do not want them to tell you confidential information about the prior employer.  If an employee reveals information that appears to be confidential, do not use it and report the matter to your management or legal counsel.

 

SCIP is indebted to the Council of CI Fellows, in particular Cliff Kalb, Dale Fehringer, Joe Goldberg, Tim Kindler, and Craig Fleisher for their creation of these FAQs. The responses were reviewed by Richard Horowitz, an expert attorney in these matters and a CI Fellow as well.  Collectively this group has well over 100 years of competitive intelligence experience, and all have served in SCIP senior leadership roles.  

 

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