Sin ttulo de diapositiva

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Business Integrity Management System
B I M S
Training Manual
By Dr. Felipe OchoaChair, Integrity Management
Task Force
Acapulco, MéxicoOctober 2, 2002
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Training Manual
To help consultants
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• With an ISO 9000 QMS in place and planning to
  include a BIMS
• Without a QMS, to implement a BIMS from scratch

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Requirements for Business Integrity
Bribery
Non-engagement in giving payment to a public
official to influence selection, execution or
compensation procedures.
Extorsion
Non-engagement in threatening a public official
to influence selection or compensation procedures
Fraud
Non-engagement in misrepresentation of facts to
meet the terms of a contract during selection or
execution
Collusion
Non-engagement in actions to influence the
bidding processes
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Implementing a BIMS
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Designing the BIMS
Analysis of the Firm
Top Management Review and Approval of Manuals
Review Existing Integrity Procedures
Review Firm Status on ISO 90012000
Design and Document Manual and Procedures
Nominate BIMS Committee
Characterizing the firm
Formulate Code of Conduct and Integrity Policy
Identify Critical Processes
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BIMS Implementation and Monitoring
Training for BIMS
Training of Internal Auditor and BIMS Manager
Training Key BIMS Operation Personnel
Awareness Training of Staff
. . .
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External Certification (Optional)
Selection of 3rd. Party Auditor
. . .
Full BIMS Audit
Standard ISO Building Blocks Integrity Assurance
Building Blocks
Preaudit
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Tasks for Designing the BIMS
Top Management Review and Approval of Manuals
Design and Document Manuals and Procedures
Formulate Code of Conduct and Integrity Policy
Identify Critical Processes

• Reasons for the code
• Irregular or illegal conducts to avoid
• Values to enhance
• Define its components
• Code formulation
• Formulation of supporting Integrity policy
• General acceptance by staff
• Approval and publication of Code of Conduct

• Identify risks factors Project Integrity risk
• Type of client
• Country of assignment
• New clients
• Size of contract
• Level of subcontracting
• Legal and administrative risk
• Internal functions
• Evaluate risk vs. cost of controlling
• Select critical processes for full integrity
  control

• List integrity assurance procedures to be
  designed
• List specific procedures required to be
  documented by the ISO 90012000 standard
• Design integrity assurance method and tools for
  each procedure
• Design forms and records for each procedure
• Prepare Documents
• Integrity Policy Objectives
• Integrity Management Manual
• Procedures Manual
• Project Integrity Files
• Records document

• Review system and critical processes
• Review manuals and other documents
• Evaluate requirements for implementation
• Evaluate training program
• Appoint BIMS coordinator
• Approve manuals and implementation program

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Formulating the Code of Conduct
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BIMS General Requirements

• Enhancing Corporate Integrity Culture
• Objectives and goals to be achieved
• Risks of corrupt behavior to be controlled
• Degree of systematization of processes to be
  controlled
• Preexistence of a Quality Management System
• How sanctions will be managed
• Strategy for awareness and acceptance of BIMS

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Potential Wrongdoing/Work Process Matrix
Bribery
Collusion
Fraud
Extorsion
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Subprocesses of Project Execution
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Control of Potential Conflict of Interest
Recommended procedure for integrity assurance

• Disclosure to client of the potential conflict of
  interest.
• Acknowledgment by client of the firms
  disclosure.
• Consentment of client to proceed under conditions
• Mitigation of potential conflict by specific
  actions

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Checklist of potential conflicts
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Between consulting firm and clients relationship
with the firm (family relationships or former
employee/partner relationship). Among
consulting assignments (conflicting in nature or
with firm recommendations in previous
assignments) Between consulting services and
procurement (conflicting design services and
procurement of goods and work) Conflicting review
of other consultants work (That might imply the
difficulty of an objective appraisal) Between
nature of the assignment and principles of the
firm
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BIMS documents
a. Statements of Integrity Policy and
objectives b. Integrity Manual Document
describing the BIMS and how the requirements of
the standard are met c. Procedures
Manual Integrity assurance procedures and
procedures required by ISO 90012000 d. Project
Integrity Record Files Documents to ensure
effective operation and control of the critical
processes and the critical projects. e.
Records Documents stating results achieved or
providing evidence of activities performed and
compliance with specific aspects of the ISO
90012000 standard
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Statement of the Integrity Policy
Partners Commitment
The firms partners and all personnel are
committed to provide quality services to their
clients with the value added by its best
practices in business integrity. The firms
objective is to satisfy client expectations and
requirements by adapting quality and its
continuous improvement as its work method and
integrity as the axiology of its behavior.
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Complementary statements
Every company employee plays a key role in
ensuring the firms integrity. All consultants
and employees must fully understand the ethics of
serving its clients. All consultants must trust
their project Leader in such case that the client
relationship becomes uncomfortable. The Project
Leader shall guarantee that all consultants and
staff members of his/her team are familiar with,
understand and comply with the firms BIMS. The
Project Leader shall ensure that throughout the
project development and completion there is full
compliance with the company BIMS All members of
the firm shall seek to identify, apply and
exchange best practices for integrity
assurance. Every department within the firm must
stipulate goals and actions in order to maintain
integrity and must look for continuous
improvement.
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Standard Contents of the Integrity Manual
1. Introduction 2. Scope, purpose and Field of
Application 3. Glossary of Terms 4. Business
Integrity Management System 4.1 General
requirements 4.2 Documentation requirements 5.
Management Responsibility 5.1 Management
commitment 5.2 Customer Focus 5.3 Integrity
Policy 5.4 Planing 5.5 Responsibility,
authority and communication 5.6 Management
review 6. Resource Management 6.1 Provision of
resources 6.2 Human resources 6.2.1 Competence
and Training 6.3 Infrastructure 6.4 Work
environment
7. Product Realization 7.1 Planning of
production realization 7.2 Customer related
processes 7.3 (does not apply to BIMS) 7.4
Purchasing 7.5 Production and Service
Provision 7.5.1 Control of production and
service provision 7.5.2 Validation of Process
Integrity 7.5.3 Identification and
Traceability 7.5.4 Control of clients
information 7.5.5 Preservation of product 7.6
(does not apply to BIMS) 8. Measurement, Analysis
and Improvement 8.1 General 8.2 Monitoring and
measurement 8.2.1 Clients perception 8.2.2
Internal audit 8.2.3 Monitoring and test of
processes 8.2.4 Monitoring and test of
services 8.3 Control of non conforming
process 8.4 System feedback 8.5 System
Improvement 8.5.1 Continual improvement 8.5.2
Corrective action 8.5.3 Preventive action
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Contents of the Procedures Manual
Reference to clauses of the ISO
90012000 Standard
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Name of the procedure
1 2 3 4 5 6 7 8 9 10 11
Management Review Procedures for Integrity
Assurance (required by the firm) Review of the
Marketing, Bidding and Contracting
processes Review of the Project Execution
process Review of the Final Delivery
process Review of the Collection
process Procedures Required by the
Standard Control of Documents Control of
Records Internal Audit Control of non conformance
service Corrective Actions Preventive Actions
5.6 4.1 4.1 4.1 4.1 4.2.3 4.2.4 8.2.2 8.3 8.5.2
8.5.3
. . .
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Project Integrity Record Files
Illustration
C O N T E N T S
1. Project description 2. Record of firm
disclosure of BIMS to client 3. Internal Auditor
record of project integrity compliance review 4.
Integrity Compliance Record of the
Processes 4.1 Marketing of Consulting
Services Technical and Economic
proposals Communication with client
Contract terms Project Managers signed written
assertion specifying facts to supply supporting
evidence that the project marketing and
contracting complied with integrity principles.
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Project Integrity Record Files
Illustration

• 4.2 Project subcontracting and Execution
• Time schedule and activity program
• Progress reports
• Subcontract documents and acceptance of
  integrity policy
• Communication with client and subcontracts
• Project time sheets and cost accounts including
  subcontracts
• Reasons justifying contract modification in
  case
• Signed written assertion of Project Manager
  specifying facts to supply evidence that the
  subcontracting and project execution complied
  with the integrity principles.
• 4.3 Project Delivery of services and Collection
• Final report and supporting elements
• Project Manager checklist of deliverables
• Client acceptance of contract completion
• Second party acknowledgment of compliance with
  integrity
• Invoice documentation and time for collection
  statistics
• Benchmark of collecting times versus usual
  collecting times for type of client
• Project Managers signed written assertion with
  supporting evidence of integrity compliance
  during the delivery and collection processes.

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ILLUSTRATION
Critical Projects
Noncritical Projects
No Subcontractors
Subcontractors
New Client
Joint Venture
Medium to Large Contract
Repeat Client
Small Size Contract
Government Client
No Subcontractors
Subcontractors
Private Client
New Client
National Local
Joint Venture
Repeat Client
Low Corruption Index
International
Repeat Client
No Subcontractors
Medium to High
New Client
Subcontractors
Private Client
Joint Venture
Corruption Index
Small Size Contract
Government Client
No Subcontractors
Subcontractors
Medium to Large Size Contract
New Client
Joint Venture
Repeat Client
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Integrity Review Form
Illustration
Internal Audit Project Review Checklist
Yes
No

• A. Marketing and Contracting Process
• 1. Disclosure to client of firms integrity
  policy
• Evidence of formal delivery to client of company
  brochures stating the existence of BIMS
• Integrity policy disclosure as part of the
  project proposal
• 2. Management of potential conflict of interest
• Evidence of having analyzed potential conflict of
  interest checklist
• Evidence of following management procedure in
  case of potential conflict
• 3. Integrity management of the bidding process
• Proposal reflects actual experience of the firm
• Resumes of experts reflect their real experience
• Evidence that the firm was not part of the short
  listing process
• Evidence that the firm did not engage in
  collusion activities with the participants
• Evidence that the firm did not derive an unfair
  competitive advantage over competition
• 4. Terms of Contract
• Terms of contract reflect the scope offered in
  the original proposal
• Evidence of justifiable reasons in case of
  changes in terms of contract
• Evidence of actions taken in case of irregular
  practices initiated by the potential client
• Evidence of actions taken in case of suspected
  wrongdoing by associates or subcontractors
• Project Managers signed written assertion and
  evidence of firms integrity during the process

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Integrity Review Form
Illustration
Internal Audit Project Review Checklist
Yes
No

• B. Project Execution Process
• 5. Adequate Work Team
• Evidence of adequate personnel levels and
  expertise throughout the service provision to
  client
• Existence of detailed terms of reference and
  contracts for associates and subcontractors
• 6. Contract Modifications
• In case of contract modifications (i.e. contents,
  price, schedules), evidence that adjustments were
  indicated and justifiable
• 7. Consultant/Client Integrity Relationship
  during Execution
• Existence of fair treatment in dealing with
  contractors selection, supervision and claims
  handling
• Evidence of no extortion attempts by client
  employees during execution
• Concrete preventive or corrective measures if
  attempted
• Project Managers signed written assertion and
  evidence of firms integrity during process

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Integrity Review Form
Illustration
Internal Audit Project Review Checklist
Yes
No

• C. Project Delivery and Collection processes
• 8. Compliance with the terms of Contract
• Evidence that actual project deliverable fulfill
  the contract terms
• Evidence of on time delivery of products or
  otherwise formal time extension acceptance by
  client
• Evidence of acceptance by client of contract
  fulfillment
• 9. Contract Collection
• Justification in case of earlier than agreed
  collection schedule
• Evidence of avoidance by firm in case of
  extorsion attempts during collection
• Project Manager's signed written assertion and
  evidence of firms integrity during processes
• D. Compliance with Integrity Procedures
• 10. Compliance with the Procedures Manual
• BIMS operation is in conformance with the
  specified system
• Non conformances

Observations and recommendations for Top
Management review The Internal Auditor
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The Training Phase
Issues

• FIDIC Training the Trainers Program
• FIDIC Member Associations
• In-house
• Contract

Selection of trainers
Trainers must have full knowledge of BIMS

• FIDICs blue book protocol1

Training must be project life-cycle oriented

• Marketing
• Contracting
• Planning
• Execution
• Delivery/Collection
• Feedback

Training must include BIMS awareness and further
training for all personnel
Specialized training must include key BIMS
operating and management personnel

• Requires adequate programming and records of
  compliance

Training must include rehearsals with senior
management
1. Guidelines for Integrity Management in the
Consulting Engineering Industry. FIDIC, FEPAC,
2001
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Further Training of Employees
Suggested issues
Discussion of themes such as

• Reason for a BIMS, objectives and stakeholders.
• The code of conduct
• Integrity policy
• Irregular conduct to be avoided
• Integrity issues in the firm
• External integrity issues with clients and
  subcontractors
• Value of BIMS
• Sanctions
• Define improvement and items to consider.

Case Example to be presented

• Analysis and discussion of conflicts of interest
  and how to manage them
• Analysis and discussion of wrongful acts in the
  various processes of the firm.

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Continuous Improvement
Types of actions
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Certification
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FIDICs Formal Request to ISO
For ISO Technical Committee 176 (responsible for
ISO 9000 standard) to consider
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BIMS to be given a proper status as a best
practice feature. Recognize that FIDICs
Guidelines (Blue Book) may be used as a
qualified reference document of the ISO 9000
standard. BIMS is on integral part of the
processes for providing consulting
services. Hence, BIMS compatible with the concept
of process approach of ISO 90012000. Give FIDIC
adequate recognition based on its Blue Book if
a new standard on Business Integrity is pursued.
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