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Guidlines for Meetings and Events Held by Companies that have Received
Emergency Government Lending Issued by U.S. Travel Association,
AH&LA and Others

Policies Support Prudent Use of Taxpayer Dollars while Supporting Meetings and Events Industry
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Washington, DC - February 9, 2009 - Leaders from key organizations representing the meetings, events and incentive travel industries united to issue guidelines on acceptable business travel practices to companies that have received emergency government lending.  The guidelines, built upon existing corporate best practices, are designed to ensure transparency and accountability and protect the one million American jobs supported by corporate meetings and events. 

"The business practices of our customers impact the welfare of our industry, our employee base and the economic health of the communities where we do business," said Roger Dow, president and CEO of the U.S. Travel Association.  "Working collaboratively, associations representing the meetings, events and incentive travel industries are addressing an urgent public need by developing clear, prudent guidelines for companies that have received taxpayer dollars."   
  
The standards support President Obama's recent call for the boards of directors of companies that have received emergency government lending to develop guidelines on conferences, events and employee recognition programs.  Highlights from the guidelines include: 

  • Conferences or events with a cost exceeding $75,000 must be supported by a written business case identifying a specific business purpose and positive return on objective and investment metrics;
  • At least 90 percent of incentive program attendees shall be other than senior executives (as defined by Treasury Department guidelines) from the host organization; and
  • Total annual expenses for meetings, events and incentive/recognition travel shall not exceed 15 percent of the company's total sales and marketing spend. 
Meetings and events are responsible for 15 percent of all travel-related spending, create nearly $40 billion in tax revenue at the federal, state and local level and generate more than one million jobs.  Without the jobs generated by meetings, events and incentive travel, the current unemployment rate of 7.6 percent would rise to 8.2 percent and cost the average American household an additional $136 in taxes annually. 
  
 
Full List of Guidelines (www.ustravel.org)

This model policy is intended for adoption by companies receiving
emergency lending from the federal government.

Model Board Policy for Approval of Meetings, Events and Incentive/Recognition Travel

1. General policy statement: The CEO shall be responsible for implementing adequate controls to assure that meetings, events and incentive/recognition travel organized by the company serve legitimate business purposes and are cost justified.

2. All proposed meetings, events and incentive/recognition travel organized by the company must serve one or more specified legitimate business purposes (see representative listing attached). Each proposed meeting, event or incentive/recognition travel with a cost exceeding $75,000 must be supported by a written business case identifying a specific business purpose.

3. Total annual expenses for meetings, events and incentive/recognition travel shall not exceed 15 percent of the company’s total sales and marketing spend.

4. The amount spent for an employee performance incentive/recognition event shall not exceed two (2) percent of the total compensation of eligible participants or 10 percent of total award earners’ compensation.

5. The process for approving meetings, events and incentive/recognition travel, and the procedures for assuring adherence to this policy, will be subject to independent audit to confirm policy adherence.

6. At least 90 percent of incentive program attendees shall be other than senior executives (as defined by applicable Treasury Department guidelines) from the host organization.

7. Performance incentives shall not promote excessive or unnecessary risktaking or manipulation of financial results.

8. All internal meetings or events attended only by senior executives (as defined by applicable Treasury Department guidelines) and/or board members shall be devoted to specific business purposes, and participating senior executives shall be responsible for any expenses incurred for non-business related activities.

9. The CEO of the company shall certify to the board at least annually that the foregoing policies are being followed, and are sufficient to provide reasonable assurance that the company’s expenditures for such purposes are not excessive.

10. These policies shall be subject to modification only with board approval
 

Examples of Legitimate Business Purposes for Meetings, Events,
Incentive/Recognition Travel
As with all business expenditures authorized in these challenging circumstances, all proposed expenditures for meetings, events and incentive/recognition travel should be made to strengthen the competitive position of the company in the marketplace and position the company for the creation of long-term value and growth. Below is a representative list of legitimate business purposes for meetings, events and incentive/recognition travel.
  • Effective product launches to educate sales force, channel partners and customers.
  • Sales conferences and employee meetings to align vision, strategy and tactics.
  • Training and staff development meetings – learning environments conducive to adult learning and professional development, improving participants' skills at their trade and/or their familiarity with the company's products or services.
  • Employee recognition programs to motivate and reward employees for achievement and productivity.
  • Professional conferences that provide networking, education and best practice sharing across companies and industries.
  • Performance incentives with clear rule structures that are designed to motivate and reward high performers for exceeding established goals that generate incremental revenue growth for their respective organizations and that are beyond the investment in the program.
  • User conferences for customers utilizing the company's products or services to obtain feedback, build networks, provide product training and capture ideas for enhancements to the company's product offerings.
  • Product development events designed to generate feedback for research and development purposes.
  • Corporate-sponsored events that further charitable purposes.
  • Trade shows and similar events that bring prospective buyers and sellers together.
  • Strategic, business and financial planning and review meetings.
  • Employee meetings as a result of company mergers and/or acquisitions for the purpose of alignment of products, brands and cultures.

"At a time when the Department of Labor reports a loss of nearly 200,000 travel related jobs in 2008 and U.S. Commerce Department data predicts a loss of an additional 247,000 travel related jobs in 2009, it is critical that every effort be made to protect beneficial meetings and events," said Dow.  "Our associations are hopeful that with stringent, transparent standards in place, policymakers and the business community can embrace meetings, events and incentive travel as responsible economic stimulants."

While the metrics outlined in the guidelines are intended for the recipients of emergency government lending, the drafters understand that many other organizations may consider the policy.  In those cases, it should be noted that the metrics may vary based on industry size, company size and market sectors.  

American Hotel and Lodging Association
Destination Marketing Association International
Meeting Professionals International
National Business Travel Association
Professional Convention Management Association
Society of Incentive Travel Executives (SITE)
U.S. Travel Association
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Contact:

Kristy Chandler
202.408.2172
kchandler@USTravel.org

K. Robert Baylor
Director of Legislative Communications
American Hotel & Lodging Association
Phone: 202-289-3122
www.ahla.com
 

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Also See: Agreement on Bailout Bill? The ''Emergency Economic Stabilization Act of 2008 Will Set Up TARP for the U.S. Economy and the Hospitality Industry / Jim Butler / September 2008
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