contract management ethics

The Importance of Contract Management Ethics

The National Contract Management Association’s code of ethics calls for professionals in the contract management industry to “continuously improve their professional knowledge and job performance in the field of contract management.”

The NCMA considers it unethical for professionals involved with contract management to accept the status quo and fail to take advantage of advances in the field that enable contract performance.  It’s essentially the same ethical concept that requires attorneys to represent their clients “zealously.” Contract management professionals owe it to their employers to do their upmost to maximize the ROI for each contract.

In today’s contracting environment, that obligation entails the use of a digital contract management system, which allows contract management professionals to meet the NCMA’s ethical guidelines and virtually always increases contract ROI. Consider the following specific requirements of the NCMA code and how contract management software helps professionals fulfill those requirements.

“Strive to attain the highest professional standard of job performance, to exercise diligence in carrying out one’s professional duties, and to serve the profession to the best of one’s ability.”

Contract management software has elevated the “standard of job performance” because it facilitates improved identification and realization of cost-saving and revenue opportunities during the contract life cycle. Software also virtually eliminates costly human error. Automation provides the “diligence” the code requires at a level not possible with manual, paper-based contract management.

“Conduct oneself in such a manner as to bring credit upon the profession, as well as to maintain trust and confidence in the integrity of the contract management process.”

The reliability, precision, and comprehensive data reporting of contract management software establish a level of “trust and confidence” with customers that can’t be achieved without automation. And within an enterprise, software with user-friendly interface features can elevate perceptions of the value of contract management as it helps internal stakeholders do their jobs better and faster, with less hassle.

“Comply with all laws and regulations that govern the contract management process in the jurisdictions in which one conducts business, including protection of competition-sensitive and proprietary information from inappropriate disclosure.”

Contract management professionals are operating with unacceptable risk if they rely on paper-based processes — the likelihood of human error is simply too great. On the other hand, top-quality contract management software includes contract authoring tools with pre-approved templates and clauses that prevent employees (e.g., overeager salespeople) from violating any legal requirements or corporate policies.

“Keep informed of developments in the contract management field, utilizing both formal training and ad hoc means, to continuously increase knowledge, skill, and professional competence.”

This requirement addresses continuing education, but the spirit of the obligation is also fulfilled with contract management software.  By using the data aggregation, analysis, and reporting features of the software, contract management professionals can continually evaluate the enterprise’s contract performance in order to “increase knowledge, skill and professional competence.” They can learn what works and what doesn’t, and why. Indeed, without the business intelligence provided by contract management software, professionals in the field are inevitably working in the dark, regardless of how much continuing education they receive.


The NCMA’s code of ethics challenges contract management professionals to do their jobs in a manner that provides the most benefit to their employers, without violating any laws, regulations, or corporate policies. To achieve this central duty of the profession — to stay current and compliant, as contract management professionals are ethically obligated to do — contract management software has become essential.