2. NATIONAL PROCUREMENT FORUM ABUJA, NIGERIA, 29th -30th June 2009 Business Ethics and Integrityin Public Procurement
3. Margaret Rose, LLB (Hons) UWI, L.E.C. Executive Director, Caribbean Procurement Institute (CPI), is an attorney at law, qualified to practice throughout the Commonwealth Caribbean for the past fourteen (14) years with extensive litigation and jury trial experience. She is Principal of the Lodewijk Meijer Group of Companies (LMG) and serves as the Chief Executive and Senior Partner in the group’s law firm, LMG ROSE & Partners. The LMG philosophy is based on providing Best of Breed Solutions in a Changing World and the work of the Group is targeted toward the sustainable development and growth of emerging markets. LMG Rose & Partners particular areas of practice include anti-corruption and procurement law, corporate commercial and taxation law, construction and infrastructure project finance and management. CPI is a private sector organization affiliated to the Lodewijk Meijer Group of Companies and established to serve policy makers and practitioners in the field of procurement dedicated to the promotion of excellent standards in procurement for both public and private sector organizations in the interests of the public good. It has established itself as the premier resource for specialist and world class procurement education , research and expertise in the Caribbean region. As Executive Director of CPI, Ms. Rose has spearheaded the development of the Procurement Intensive Seminar Series ™ which is series of two day intensive training programs designed to give the participant an in-depth and comprehensive coverage of the legal and practical complexities arising in specialized areas in the field of procurement. Ms. Rose advises Government Ministers and both public and private sector bodies and has served on several state and private sector boards and chaired Procurement Advisory Committees and Tenders Committees. Ms. Rose is presently a Director on the Board of Trinidad and Tobago Transparency Institute (TTTI) and serves on the Procurement Reform Committee of TTTI, and the board of the Caribbean Association of Procurement Professionals (CAPP). In 2008 Ms. Rose was appointed to serve on the Advisory Board of the International Public Procurement Conference (IPPC) body and in April 2009 she was appointed to the Anti Corruption Committee of the World Federation of Engineering Organizations (WFEO). .
13. The Old World Order A Two Block Economic World Order – Market Value based Equities and Bonds (combined) as of Sep 30, 2008 North America = 37.4% Easy to understand, US-led world order Em Markets =6.2% Europe/Dev Asia =56.4% Source: LMG Compendeon GTAA
14. The New World Order A Three Block Economic World Order – GDP Based Situation as of Sep 30, 2008 US? EU? BRIC? Where should I invest? Global Exchanges Em Markets =34.7% Exp Growth 2009-11 = 7.0% Europe/Dev Asia =37.7% North America = 27.6% Exp Growth 2009-11 = 2.0% Exp Growth 2009-11 = 1.3% Source: LMG Compendeon GTAA
15. Global – Globalization of Financial Markets Globalization of Financial Markets resulted in an increase in market correlations: Gradually so in Developed Markets, that were already reasonably integrated in the world economy Spectacularly so in Emerging Markets, due to: A) Trade Liberalization Programs B) Increase in Foreign Direct Investment activities C) Spectacular Growth in Portfolio Investments in Em Markets by Institutional Investors both from Developed Nations and from Em Markets (SWFs)
17. Spectacular Increase in Correlations in Emerging Markets Globalization Dev Markets Spectacular Increase in Correlation in EMs
18. Procurement In A Changing World The function of procurement is becoming increasingly recognized as the most strategic function for a government in the present global environment and inextricably tied to economic growth.
19. Procurement – The Value Exchange Goods Works Services Infrastructure
24. Gains to be realized through Good Procurement Direct Effect = Lower Costs Combined Effect = Huge Increase in Project Values; Especially those with long duration Indirect Effect = Lower Risk Premium Better returns on old capital, increases potential for new capital
39. NOTE: NO DEVELOPED COUNTRIES – UNCITRAL BASED Only developing and transition economies have undertaken legislative reform on the basis of the UNCITRAL Model Law!
40. WTO – Government Procurement Agreement The WTO Agreement on Government Procurement (WTO-GPA) came into force at the conclusion of the Uruguay Round of multilateral trade negotiations in 1994 and seeks to provide an international legal framework for the liberalization and governance of public procurement markets. Full Text Available for Download at www.wto.org
41.
42. Detailed requirements regarding transparency and procedural aspects of the procurement process, in general, designed to ensure that covered procurement under the Agreement is carried out in a transparent and competitive manner that does not discriminate against the goods, services or suppliers of other Parties;
46. Provisions regarding accession to the Agreement and the availability of Special and Differential Treatment for Developing and Least Developed Countries; and
47.
48.
49. At present, there are eight (8) WTO Members which are in the process of acceding to the GPA: Albania, Georgia, Jordon, the Kyrgyz Republic, Moldova, Oman, Panama and Chinese Taipei.
55. There is a lack of domestic ownership of the procedures which stymies long term capacity development.
56.
57. Directive on the coordination of procedures for the award of public works contracts, public supply contracts and public service contracts, 2004/18/EC - transparent - open procedures - fair conditions of competition for suppliers
58.
59. EPAs are trade and economic partnerships between regional groups of African Caribbean and Pacific (ACP) countries and the EU. They replace the trade arrangements of the EU-ACP Cotonou Partnership Agreement which expired at the end of 2007. The ACP countries decided themselves on the regional groupings for EPA negotiations. There are four negotiating regions in Africa, one in the Pacific and one in the Caribbean. The Caribbean group is made up of the 15 CARIFORUM countries.
70. ECOWAS EC EPA NIGERIA must now continue to deal with the on going ECOWAS EC EPA negotiations. Government procurement and trade and investment experts can learn from the CARIFORUM experience. NIGERIA has the potential to be the leader in the ECOWAS negotiations – opting to serve as the anchor for the smaller, poorer West African states. Côte d’Ivoire’s has signed. Ghana soon to follow. Will Nigeria be able to lead?
71. Significant Developments in the Common Law of Competitive Bidding Implied Tender Contract Doctrine – Ron Engineering 1981 (Canada) BlackPool Case 1990 (UK) Pratt Contractors Privy Council Decision 2004 (New Zealand) NH v UDECOTT Cv. App. 95 of 2005 – judgment delivered 17th March 2006 (Trinidad and Tobago)
72. The Ten Stages of the Procurement Cycle 1. Identifying Needs 2. Determining Procurement Method 10. Assessing Performance 9. Contract Performance and Management 3. Tender Call Drafting 8. Contract Execution 4. Issuing Tender Call 7. Selection of Supplier 5. Submission of Tenders 6. Evaluation of Tenders Diagram, Paul Emmanueli CPI Faculty Director
73. The Formation of Contract A and Contract B Purchaser’s Offer to Enter Into Contract A Purchaser Issues Tender Call Purchaser’s Invitation to Treat on Contract B Bidder’s Acceptance of Contract A Offer Contract A Formed Bidder Submits Compliant Tender Bidder’s Binding Offer to Enter Contract B Purchaser Accepts Bidder’s Contract B Offer Purchaser Selects Bidder’s Tender Bidder Must Honour its Tender to Comply With Contract A Diagram, Paul Emmanueli CPI Faculty Director
74.
75. Procurement no longer viewed as a transaction but occurring over the whole life cycle. Efficiency in procurement function must necessitate proper systems and capacity at each stage of the cycle.
76. Domestic Sovereignty over Procurement Systems slowly being eroded. Trade Agreements, International trade bodies and Donor Regimes demanding more OPEN procurement.
77.
78.
79. Part of Next – 11Goldman Sachs 2005 One of the New Frontier Champions?
101. Oil resources and demand recovery will prove an enormous asset that will remain responsible for the bulk of foreign reserve inflow
102. The domestic and regional markets in other industries will grow in importance
103. Enormous pool of cheap and relatively young labor (compare the major theme in Goldman Sachs’s Next-11)Sources: Renaissance Capital and LMG Compendeon
104.
105. Lack of transparency of the banking system and ECA might hinder growth (However note positive)Sources: Renaissance Capital and LMG Compendeon
108. ECA is a strong asset. SWFs can be transformed into catalyst for growth
109. Diversification effect of an economy less dependent on oil can mitigate high country risk premiumSources: Renaissance Capital and LMG Compendeon
110.
111. But as so often: monetary factors and the stock market might be ‘leading indicators’. Signs of improvement and opportunities already visible.
112. We understand that the government will be ‘busy’ mitigating the effects of the Global Crisis and fighting the upheaval in the Niger Delta.Sources: Renaissance Capital and LMG Compendeon
120. (Infant Mortality ↓; Life Expectancy ↑)Sources: Renaissance Capital and LMG Compendeon
121. YES NIGERIA CAN! TI Corruption Perception Index According to the Transparency International Corruption Perception Index. In 2001, 2002 and 2003, Nigeria was ranked the second most corrupt country out of the surveyed countries. From 2005 to 2007, Nigeria ranked the eighth, twenty second, and thirty second most corrupt among the surveyed countries. In 2008 one hundred and twentieth!
123. Professionalizing Procurement Margaret Mead Never doubt that a small group of thoughtful, committed citizens can change the world. Indeed, it is the only thing that ever has.
145. Guy Callender and Darin Matthews The Role of Immanence in the future of Public Procurement (International Public Procurement Conference Proceedings, Vol 3 “In the case of procurement and supply chain management, the speed with which outside influences are changing procurement knowledge and practice result in the core body of knowledge within procurement being summarized as the capacity to manage procurement practice using a constantly variable mix of knowledge drawn from other disciplines to achieve the results of practitioners in the field….. Procurement professionals need to be able to evaluate procurement influences across a range of discipline areas at a professional standard of knowledge rather than just demonstrating a working appreciation of these content areas” (See also Giunipero, 2000; Humphreys, 2001; Wynstra, van Wheele, & Weggerman, 2001).
146. How it operates now.. Growing Focus Limited Focus Full Focus
147. Purchasing Certifications – Pre 1990 World divided into two main blocks Notice the Focus on Operational layer
152. Most national procurement regulatory bodieshave training programmes for their staff Common feature – focus on purchasing and supply chain practitioners
153. CIPS (UK) International Qualification in Purchasing and Supply The International Certificate and Advanced Certificate in Purchasing and Supply is an appropriate starting point for non UK-based learners. International Certificate in Purchasing and Supply C1 Understanding purchasing principles C2 Selecting the right supplier C3 Effective negotiation in purchasing and supply C4 Managing inventory C5 The business environment for purchasing and supply International Advanced Certificate in Purchasing and Supply A6 Analysing the supply market A7 An introduction to purchasing strategy A8 Preparing and managing contracts A9 International logistics A10 Measuring performance in purchasing and supply [Excerpt www.cips.org]
154. CIPS (UK) Level 2 Introductory Certificate in Purchasing and Supply The Level 2 Introductory Certificate in Purchasing and Supply qualification is a stand-alone qualification, taking a minimum of 20 guided learning hours. It has been developed in order to cover the basic principles of purchasing and supply. It is one unit, consisting of four elements: The role and scope of purchasing Systems and procedures in purchasing Working with suppliers The importance of purchasing contracts The Level 2 Introductory Certificate will be assessed using a one hour online test.
155. CIPS (UK) Level 3 Certificate in Purchasing and Supply This award is the ideal entry point for anyone new to the profession as no prior qualifications or experience is required. It comprises five units: L3-01 Understanding the purchasing environment L3-02 Purchasing operations L3-03 Client and supplier relationships L3-04 Securing supply L3-05 Purchasing in action - Integrative unit Level 4 Foundation Diploma in Purchasing and Supply Many members who have previous business experience or qualifications commence their CIPS studies with Level 4. Together with Level 5 and 6 it is the most common route to reach full Membership and obtain the designatory letters MCIPS. L4-01 Effective negotiation in purchasing and supply L4-02 Developing contracts in purchasing and supply L4-03 Measuring purchasing performance L4-04 Managing purchasing and supply relationships L4-05 Purchasing contexts
156. CIPS (UK) Level 5 Advanced Diploma in Purchasing and Supply The Advanced Diploma has five units but this award introduces optional units to learners. There are three core units and a choice of six optional units, from which candidates must complete two. Core units: L5-01 Management in the Purchasing Function L5-02 Risk Management and Supply Chain Vulnerability L5-03 Improving Supply Chain Performance Optional Units: L5-10 Marketing for Purchasers L5-11 Storage and Distribution L5-12 Operations Management in the Supply Chain L5-13 The Machinery of Government L5-14 Contracting in the Public Sector L5-15 Sustainable Procurement
157. CIPS (UK) Level 6 Graduate Diploma in Purchasing and Supply The Graduate Diploma has five units, there are three compulsory core units and two optional units must be chosen from a choice of five. When the Graduate Diploma has been successfully completed, members can apply to become a full Member of CIPS which entitles them to use the designation, MCIPS after their name. Core units: L6-01 Leading and influencing in purchasing L6-02 Strategic supply chain management L6-03 Supply chain management in practice - Integrative unit Optional units: L6-10 Legal aspects in purchasing and supply L6-11 Advanced project management L6-12 Finance for purchasers L6-13 Strategic Public Sector Programme Management L6-14 Public Sector Stakeholders and Governance
158. CIPS (UK) Level 7 Executive Diploma in Purchasing and Supply Management This qualification is an opportunity for members who have already achieved MCIPS to undertake further personal and professional development. The Executive Diploma uses a self-managed learning approach and has four elements: a strategic learning contract a literature review a business project a self-review and evaluation.
159. SCM Associations and Certification Programs The following is a list of trade and professional associations, and links to any of their certification programs specifically in the supply chain management area involved in some aspect of supply chain management. AME - The Association for Manufacturing Excellence3115 No. Wilke Rd., Suite GArlington Heights IL 60004+1 224.232.5980 APICS – The Educational Society for Resource Management Certification Programs5301 Shawnee Road Alexandria, VA 22312+1 800.444.2742 AST&L - The American Society of Transportation & LogisticsCetification Programs1700 N. Moore Street, Suite 1900Arlington, VA 22209+1 703.524.5011
160. SCM Associations and Certification Programs ATA - American Trucking Association2200 Mill RoadAlexandria, VA 22314+1 703.838.1700 ISM - Institute for Supply ManagementCertification ProgramsP.O. Box 22160 Tempe, AZ 85285+1 480.752.6276 IWLA - International Warehouse Logistics Association2800 S. River Road, Suite 260 Des Plaines, IL 60018 +1 847.813.4699 MHIA - Material Handling Industry of America8720 Red Oak Blvd., Suite 201Charlotte, NC 28217-3992 +1 704.676.1190
161. SCM Associations and Certification Programs NITL - National Industrial Transportation League1700 North Moore Street, Suite 1900Arlington, VA 22209 +1 703.524.5011 SmartWay Transport Partnership2000 TraverwoodAnn Arbor, MI 48105+1 734.214.4767 SOLE – The International Society of LogisticsCertification Programs810 Professional Place, Suite 111Hyattsville, Maryland 20785+1 301.459.8446
162. SCM Associations and Certification Programs SCC - Supply-Chain Council1400 Eye St., NW Ste. 1050Washington, D.C. USA 20005+1 202.962.0440 VICS - Voluntary Interindustry Commerce Solutions AssociationCertification Program1009 Lenox Drive, Suite 202Lawrenceville, NJ 08648+1 609.620.4590 WERC - Warehouse Education & Research Council1100 Jorie Boulevard, Suite 170Oak Brook, IL 60523+1 630.990.0001
163. But For whom? Responsive to the needs of Strategic Procurement
164.
165. University of Rome Tor Vergata – Master in Procurement Management September 2009!
166.
167. A Federation of Associations serving the needs of purchasing and supply management professionals.
168. A union of 43 National and Regional Purchasing Associations worldwide. Within this circle, about 200,000 Purchasing Professionals can be reached.
169. IFPSM facilitates the development and distribution of knowledge to elevate and advance the procurement profession, thus favorably impacting the standard of living of citizens worldwide through improved business practices.
170. The term procurement is taken to embrace purchasing, materials management, logistics, supply chain management and strategic sourcing.
171. IFPSM is a non-political, independent and non-profit oriented International Organization, registered in Aarau, Switzerland.
173. Best of Breed Solution for a Changing World THE CARIBBEAN PROCUREMENT INSTITUTE (“CPI”) is a private sector organization established in December 2006 to serve policy makers and practitioners in the field of procurement. We are dedicated to the promotion of excellent standards in procurement for both public and private sector organizations in the interests of the public good.
174. Best of Breed Solution for a Changing World Several professionals from the disciplines of law, finance, development studies, construction, IT and Oil and Gas got together to begin to develop a common transferable body of knowledge in the field of public procurement. During 2007, CPI liaised with world experts, practitioners and academics to develop a defining philosophy for the entity.
175. Best of Breed Solution for a Changing World HOW ARE WE DIFFERENT?
176.
177. Eschewing the transactional approach to the function of procurement and promoting an appreciation of the function of procurement within the context of the entire procurement cycle and as it relates to financial management, legal accountability and risk management paradigms
178. The programmes are specifically designed to serve the needs of ALL stakeholders involved in the various stages of the procurement cycle including decision makers (leaders, policy makers, CEOs, Directors), professionals interacting with the procurement (lawyers, accountants, Auditors, Quantity Surveyors, Engineers, Architects, Project Managers) procurement managers, purchasing, logistics and supply officers and private sector participants in procurement (suppliers, contractors and consultants)
179. Commitment to the creation of region specific and relevant programmes developed jointly by international and regional academic and practitioner experts
181. What we have done so far…. Establishment of a faculty of International academics and practitioner experts to assist in the development of courses for ALL professionals interacting with the function of procurement.
182. What we have done so far First Caribbean Public Procurement Conference (CPPC) March 2008, over 170 leading world and regional academics, public officials and professionals.
183.
184. Partnered with International bodies to further develop the common transferable body of knowledge in procurement.
185. Developed the Procurement Intensive Seminar Series™ and trained close to 200 professionals during 2008.
186. Developed and trademarked the NEW professional designation of Procurement Professional PP – Procurement Professional LPP - Legal Procurement Professional CPP – Construction Procurement Professional FPP – Finance Procurement Professional PMPP – Project Management Procurement Professional
187.
188. To increase the appreciation of the value of procurement good practice by raising the profile of procurement professionals in the region.
190. To establish and implement training and certification standards and requirements for the procurement profession
191. To work with its members to establish and mentor national chapter associations.
192.
193. The Commonwealth Procurement Institute,Headquartered in Ontario, Canada will license institutes and associations of professionals desirous of working toward the new professional designations.
194. The Objectives of The Commonwealth Procurement Institute To spread and improve appreciation of the value of procurement good practice by raising the profile of procurement at the leadership level in both the public and private sectors and acting as a catalyst for learning, knowledge sharing, and consensus building throughout the Commonwealth and worldwide. To educate leaders and develop professional skills among practitioners in the art and science of procurement towards achieving excellent standards and maximising value in public and private sector organizations. For the benefit of the public good, to promote high standards of professional skill, ethics and integrity among all those engaged in procurement. To promote the development and utilization of a common transferable body of knowledge in the field of procurement.
195. The Objectives of The Commonwealth Procurement Institute To support, encourage and promote institutions and associations established to serve the needs of procurement professionals and all professionals interacting with the function of procurement for the public good. 6. To promote and encourage continuous research and development in the field of procurement 7. To educate persons engaged in the practice of procurement and by means of examination and other methods of assessment to certify the skills and knowledge of such persons. 8. To provide specialist expertise to Governments, tertiary institutions, associations, leaders and organisations engaged in the function of procurement.
196.
197. Masters in Procurement Management with University of Rome Tor Vergata – September 2009. Graduates will receive (Msc). Procurement Management and (PP) Certified Procurement Professional designation
198. Charles Holden, Director General of IFPSM "The International Federation of Purchasing and Supply Management is proud to be working closely with CPI to assist in the investment in higher levels of procurement professionalism within the Caribbean, particularly the formation of the professional association CAPP. Accordingly, it is recognized as a highly beneficial advance for such professionalism that CPI is able to introduce in partnership with the University of Rome, a Master Programme in Procurement Management. Such a programme adds significantly to the recognition of Caribbean practitioners in the International marketplace"
199. THANK YOU be the change you wish to see in the world Mahatma Gandhi
200. Acknowledgements Dr. Erik L. van Dijk, CPI Faculty Director ESG Finance & Investments CEO/CIO LMG Compendeon 120 Abercromby Street, Port of Spain, Trinidad www.lmgcompendeon.com Caribbean Procurement Institute 120 Abercromby Street, Port of Spain, Trinidad, www.caribbeanprocurementinstitute.com Renaissance Capital 5th Floor Professional Centre Plot 1B, Bank PHB Crescent Victoria Island, Lagos Nigeria www.rencap.com Goldman Sachs 32 Old SlipNew York, NY 10005 United States www2.goldmansachs.com/gsam