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The Ethics Coach on Verbal Agreements, Ghostwriting and More

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Q: When you close a deal verbally, shake on it and confirm the conversation by e-mail, are both parties legally, morally and/or ethically bound to it? What is one's word worth?

A: The worth of a person's word is revealed over time. Reneging on a promise drives the value of reputation down.

Though a handshake can leave both parties feeling they've had a successful meeting, they might head back to their offices with very different interpretations of what was reached. This becomes evident later, when one sends a follow-up e-mail to start drilling down to the details. To avoid surprises, really dig into the heart of the proposal during your meeting to make sure you're operating from the same perspective.

But even if you do all this, is it enough to protect your interests? I asked Richard Mandel, associate professor at Babson College, whether oral agreements have legal standing. He says they are generally enforceable (with exceptions that vary by state), "so long as they contain enough specificity to satisfy the minimum requirements of a contract."

The caveat, he adds, is that the existence and terms of an oral agreement may be difficult to prove without witnesses. As for that written follow-up, Mandel says e-mail exchanges can constitute a binding contract if they confirm details both parties agreed to, and the authorship of the e-mail can't be questioned. All in all, written contracts are the best way to protect your business.

Q: My agency offers ghostwriting services: researching, writing and publishing blog posts, articles and opinion pieces under our clients' names. When a client saw his name on an article I'd written, he questioned whether it was ethical to have his signature on my insights. Is ghostwriting ethical and fair?

A: Readers are deceived when a bylined article doesn't reflect the views of the stated author. Your client's discomfort that his product expressed your ideas more than his own raises a red flag on your ghosting process. You need to add steps to the process to make sure the finished piece reflects the client's point of view, not yours.

Branding is inextricably tied to thought capital, so work with your clients to develop themes central to their business that you can expand into ghosted pieces. Before writing a piece, fill the client in on the ideas you're going to include to get their go-ahead and see if there's anything they want to add. Once you have a draft, run it by the client for feedback and again after revisions to get final approval before sending it out into the world.

If clients balk at this process, remind them that their byline makes them responsible for the content. Ghostwriting is an established practice for leaders to extend their reach. Operating according to ethical guidelines creates long-term credibility for them and a sustainable reputation for you.

Q: My company manages the marketing and design campaign for a long-term client. That client's competitor recently approached us to work for them. I want both clients. Would this be a conflict of interest?

A: Look at it from your existing client's perspective. Are they likely to see their interests helped or harmed if you add their competition to your roster? Will their concerns about loyalty, trust, confidentiality, allegiance to their business goals and keeping a competitive edge be addressed to their satisfaction, or will they start to wonder if it's time to jump to your competition?

If you still want to move forward, talk to your current client to find out if they are open to it and what they would need to be comfortable. Keep in mind: It's one thing to make it clear from the get-go that your firm may work for multiple clients in the same industry, but it's a different matter to change the rules on a long-term client. Transparency is key.

One possible solution: Consider adopting a business model that can support competing clients; a change that requires making investments in separate teams and creating firewalls to protect client interests. Throughout this process, keep checking your choices against your firm's core values. Putting your core values to work in decision-making helps fortify you against backlash from unintended consequences.