FIDIC Tools and Initiatives on Integrity Management

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BIMILACI 2005
FIDIC Tools and Initiatives on Integrity
Management
Dr. Jorge Díaz Padilla President-Elect,
FIDIC Washington, D.C., April 8, 2005
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The FIDIC Strategy

• FIDIC must represent and promote ethical
  business practices throughout the industry, and
  work with others to achieve this objective.

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The Integrity Approach

• To operate successfully in an increasingly
  global world, a firms procedures will have to
  conform to generally accepted best practices. In
  particular, ethical behaviour toward all the
  firms stakeholders must be key and visible.

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The FIDIC Tools

• Code of Ethics
• Policy on Business Integrity
• Policy on Conflict of Interest
• Business Integrity Management System, BIMS
• Model Representatives Agreement

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Integrity Management
Most firms are doing their best to define and
implement anti-corruption policies, but many lack
consistency in their day-to-day business
transactions and fail to obtain systematic
feedback which may improve the process.
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Integrity Management
What is missing is a framework which may be used
to connect and transform isolated acts of
integrity assurance into a complete management
system.
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The FIDIC BIMS

• The integrity management concept calls for an
  internal system within the firm that is designed
  as an effective tool to prevent corrupt
  behaviour, and to encourage integrity.

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The FIDIC BIMS
FIDIC chose the term Business Integrity
Management on purpose integrity management, as
opposed to corruption control, accurately
reflects the all-encompassing approach of the
BIMS process.
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The FIDIC BIMS
FIDIC promotes best business practices and
believes that quality and integrity management
are intimately interrelated. For that reason it
advocates that member firms engage in integrity
management as an extension of their quality
processes.
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The FIDIC Rep Agreement

• FIDIC drafted a Model Agreement for firms
  engaging a Representative to develop business or
  assist in obtaining, monitoring or executing
  contracts in a foreign country.

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Collaborating with Others

• FIDIC promotes ethical business practices
  throughout the industry and, for this purpose,
  works and cooperates with other organisations in
  the development and implementation of various
  initiatives to combat corruption.

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Collaborating with Others

• FIDIC was invited as a member of the Editorial
  Advisory Panel of TIs 2005 Report which is
  focused on corruption in construction, and where
  BIMS was highlighted.

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Collaborating with Others

• In addition to promoting integrity business
  practices on the supply side" of corruption,
  FIDIC collaborates closely with the multilateral
  development banks in the implementation of
  initiatives to fight the demand and the
  condoning sides.

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Anti-corruption Initiatives

• During the last years several initiatives have
  been proposed to move from corruption awareness
  to specific anti-corruption programs
• The FIDIC BIMS (2001)
• TIs Business Principles for
• Countering Bribery (2003)

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Anti-corruption Initiatives

• The WEFs initiative against corruption in
  engineering and construction (2004)
• FIDIC Model Representative Agreement (2004)
• The 10th principle (Anti-corruption) in the UNs
  Global Compact (2004)

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Anti-corruption Initiatives
FIDIC BIMS, policies and Model Agreements
ISO Standards and Corporate Social
Responsibility Guideline
WEF Partnering Against Corruption Initiative
UN Global Compact 10th Principle
(anti-corruption)
TI Business Principles for Countering Bribery
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The Road Ahead

• Throughout recent years the fight against
  corruption has made significant progress in the
  consulting industry. BIMILACI 1999 became a
  turning point when, at the time, the WB and the
  IDB supported FIDICs initiative to develop
  BIMS. Nowadays, many firms have adopted this
  system and, some of them, have obtained
  third-party certifications.

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The Road Ahead

• Most other tools available at the moment, such as
  TIs integrity pacts, the WEFs support
  statement, or the World Banks modification to
  its Form of Bid, although useful in specific
  cases, tend to be piecemeal since they were not
  designed as general frameworks for the routinary
  management of corruption risks.

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The Road Ahead

• The challenge is then to develop and implement
  practical mechanisms so that firms may be able to
  track the application of anticorruption
  principles during their daily business
  operations, including procedures to identify
  risks, prevent and combat corruption, and
  implement integrity policies. FIDIC has led the
  way in this area with the development of BIMS.

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The Road Ahead

• However, what is still needed is full support
  from the IFIs to recognise the efforts made by
  the firms who have embraced this initiative. To
  this end, FIDIC would like to acknowledge the
  Asian Development Bank who recently announced its
  decision to include integrity management during
  the selection of consulting firms.

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In Summary

• The IFIs have introduced different measures to
  improve their anti-corruption procedures. Still,
  there is a lot of room for improvement in areas
  such as transparency of information,
  harmonisation of procedures and explicit
  recognition of integrity management during the
  procurement of consulting services.

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Thank you very much