During its quarterly meeting in mid-December the DSA Board of Directors approved an amendment to its policies and procedures document that clarifies the actions that will be taken in the case of marketing plan changes by a company as a result of a state or federal action.
Under current procedures, all active direct selling company members are automatically reviewed at least once every five years. This procedure is in place to continually verify that marketing plans approved as part of the initial membership application process have not subsequently been changed in a way that puts it outside of compliance with the Code.
Under the new policy, any company that makes changes to its marketing plan as a result of a state or federal action, and that would fall under the scope of the Code, must notify DSA and will automatically be set for review of the new plan. Actions against a company frequently result in a voluntary change to a marketing plan that satisfies both the law enforcement entity and the company. However, in order to assert that the new plan is in compliance with the DSA Code, a new review must take place.
In the case of any criminal finding or admission, the company’s DSA membership can be terminated by a majority vote of the Board of Directors.
While the DSA Code Administrator has the authority to recommend various actions be taken regarding a company’s membership status as a result of his work, these additions to the Board policies ensure that swift and appropriate action can be taken in cases where it is clear that a plan needs to be reviewed or a company is found to be violating the law.
Many may also be surprised to learn that a significant number of companies that apply for membership do not ultimately make it through the review process. In addition to going out of business, companies often realizes they cannot comply with all of the provisions of the Code. Many companies will voluntarily change their policies when presented with a list of areas of concern by DSA staff, but others choose instead to withdraw from consideration.
As part of its actions at the recent meeting, the Board also directed DSA staff to evaluate and enhance the membership application review process with additional checks and investigations to ensure all companies admitted into membership are practicing the highest level of business ethics. Additionally, the list of companies pending review will be listed on the DSA Web site and comments from the public will be welcome.
The past year has been a busy one as many new provisions were added to the Code in September, and additional reviews of various Code provisions and possible enhancements are ongoing. These Code enhancements are critical steps in proactively working to make sure DSA member companies represent the best of the best.