RISK

MANAGEMENT
AND THE ROLE
OF ETHICS IN
MICE INDUSTRY
INTRODUCTION
 Event must comply with the standard and customary regulations and
procedures. There are four basic reasons why an event must comply with
existing laws and regulations. A strategy of risk management is essential to
protect the event organizer and to ensure that the delegates have safe and
enjoyable experience.
 Ethics has been an area of concern since the beginning of time. The MICE
Industry needs to reevaluate its ethical standards because it faces a number
of ethical dilemmas in its business practices. It is essential that the MICE
industry follow the concepts of business ethics and develop and implement
an appropriate code of conduct.
 COMPLIANCE WITH EXISTING
LAWS AND REGULATION
There are many reasons why an event must comply with
existing laws and regulations. The four primary reason are:
 TO PROTECT ONE’S LEGAL
INTERESTS
-Preparing contracts, permits, and licenses that are required
and complying with other legal requirements will ensure that
the event may proceed without interruption. The event
manager should hire a competent legal counsel to review all
standard agreements such as hotel contracts to ensure their
validity prior to execution.
TO ABIDE BY ETHICAL
PRACTICES
One of the requirements of a profession is to follow
a code of ethical conduct. Event management has
emerged as a modern profession, a code of ethics
has been developed by the International Special
Events Society (ISES).
TO ENSURE THE SAFETY AND
SECURITY OF THE EVENT
STAKEHOLDERS
A safe event environment is one that is protected
from future harm. The event manager is
responsible for constructing a safe, secure
environment and sustaining it during the course
of an event.
TO PROTECT ONE’S
FINANCIAL INVESTMENT
Practicing thorough legal, ethical, and risk
management proactive measures may help the
event produce greater revenue. Lapses in legal,
ethical, and risk management judgement may not
only loss of property, life, and money but also
loss of the evet’s good name.
 BASIC
COMPONENTS OF
AN EVENT
MANAGEMENT
AGREEMENT OR
CONTRACT
The event management contract shows
the agreement between two or more
parties regarding their mutual interests
as specified in the agreement. A
binding contract must contain the
following basic components:
A. PARTIES
the names of the parties must be clearly identified.
The agreement must be described as being between
these parties and the names that are used in the
agreement must be defined
B. OFFER
the offer is the service or product given by one
party to another. The event manager may offer
consulting services to a client, or a vendor may
offer products to an event manager. The offer
should list all services that an event
professional offers to provide.
C. CONSIDERATION
the consideration clause defines what
one party will provide the other upon
the acceptance of an offer.
D. ACCEPTANCE
When both parties accept an offer, they execute
or sign the agreement confirming that they
understand and agree to comply with the terms
and conditions of the agreement.
OTHER COMPONENTS
 Terms
 Cancellation
 Force Majeure (Act of God)
 Arbitration
 Billing
 Time is of the Essence
 Assignment
 Insurance
 Hold Harmless and Indemnification
 Reputation
AGREEMENTS
 The complete agreement is the final clause which states
that the agreement constitutes the full understanding of
both parties.

 There are other management agreements aside from the

main event agreement. These are:
1. CONSULTING AGREEMENT
 – an agreement in which one party, usually the event
manager, agrees to give consulting services to another
party.

2. EMPLOYMENT AGREEMENT
 – an agreement in which an employee agrees to particular
terms of employment
3. EXHIBITORS CONTRACT
 an agreement between exhibitors and the sponsors of an
exhibit to rent a booth at the exhibit

4. HOTEL CONTRACT
 an agreement between the hotel and the organization holding
an event to furnish rooms, function space, and food and
beverages services for a particular event or several events.
5. NON-COMPETE
AGREEMENT
 an agreement in which an employee agrees not to engage
in a contract in a particular industry for a certain period of
time after the conclusion of employment.

6. PURCHASE ORDER –
 an order to a seller to supply products or services
7. SPONSORSHIP AGREEMENT
 an agreement between a sponsor and an event organizer in
which the event organizer agrees to give marketing services to
the sponsor for specific payment

8. VENDOR AGREEMENT
 an agreement between the seller and the event manager to
supply particular services or products for an event.
MEANING OF PERMITS AND
LICENSES
 Permits are issued by local governments. They allow the
event managers to hold event activities. A permit is issued
only after necessary documents have been submitted and
the necessary payment has been made.

A license is issued by a government agency or by a

private association. It allows the event manager to hold
a particular event manager to hold a particular activity.
THERE IS DIFFERENCE
BETWEEN THE PERMIT AND
LICENSE
There are strict requirements for obtaining license
than those required for obtaining a permit. Permits
and licenses must be acquired for several events. The
bigger the event, the more permits and licenses must
be acquired
SYNERGISTIC RELATIONSHIP
OF CONTRACTS, PERMITS
AND LICENSES
 The event manager must comprehend the importance of
contracts, permits, and licenses in organizing modern
events.

a. Contract, permits, and licenses have legal ethical,

and risk management effect.
b. To produce positive results, event managers
should cooperate with concerned agencies.
 SHORT QUIZ
1. Prepare contracts, permits, and licenses that are required and complying with other legal requirements will
ensure that the event may proceed without interruption
2. One of the requirements of a profession is to follow a code of ethical conduct.
3. A safe event environment is one that is protected from future harm.
4. Practicing thorough legal, ethical, and risk management proactive measures may help the event produce
greater revenue.
5. The agreement must be described as being between these _______and the names that are used in the
agreement must be defined
6. Is the service or product given by one party to another.
7. It defines what one party will provide the other upon the acceptance of an offer.
8. They execute or sign the agreement confirming that they understand and agree to
comply with the terms and conditions of the agreement.
9. Is the final clause which states that the agreement constitutes the full understanding of
both parties.
10. An agreement in which one party, usually the event manager, agrees to give
consulting services to another party.
11. An agreement in which an employee agrees to particular terms of employment.
12. An agreement between exhibitors and the sponsors of an exhibit to rent a booth at the
exhibit
13. An agreement between the hotel and the organization holding an event to furnish
rooms, function space, and food and beverages services for a particular event or several
events.
14. An agreement in which an employee agrees not to engage in a contract in a particular
industry for a certain period of time after the conclusion of employment.
15. An order to a seller to supply products or services.
16. An agreement between a sponsor and an event organizer in which the event
organizer agrees to give marketing services to the sponsor for specific payment
17. An agreement between the seller and the event manager to supply particular
services or products for an event.
18. Are issued by local governments. Is issued only after necessary documents have
been submitted and the necessary payment has been made.
19. Is issued by a government agency or by a private association.
20. Is essential to protect the event organizer and to ensure that the delegates have safe
and enjoyable experience
ANSWER
 1. To protect one’s legal interests  11. Employment agreement
 2. To abide by ethical practices  12. Exhibitors contract
 3. To ensure the safety and security of the  13. Hotel contract
event stakeholders
 14. Non-compete agreement
 4. To protect one’s financial investment
 15. Purchase order
 5. Parties
 16. Sponsorship agreement
 6. Offer
 17. Vendor Agreement
 7. Consideration
 18. Permits
 8. Acceptance
 19. License/s
 9. Agreements
 20. Risk management
 10. Consulting agreement
 GROUPINGS.
1. Risk Management Procedures and .Risk Control
Measures
2. : Role of Ethics in Society
3. Unethical practices in the MICE Industry and The
importance of a Code of Ethics