Introduction

Third parties (e.g., partners/contracted parties) are increasingly executing important activities, where significant amounts of funds are involved. The responsibility to ensure proper use of donor funds remains with Helvetas, thus risk management is an important element of duty of care of Helvetas.

In the initial phase of a collaboration, it is the responsibility of project managers to perform due diligence to identify risks and develop commensurate measures for risk management.

The purpose of this document is to provide a guidance to Helvetas country offices and projects on how to address the main risks that are likely to happen in a procurement process conducted by Helvetas partners/contracted parties. When conducting due diligence in the process of selecting a partner/contracted party, this document can also be used as a complementary checklist specifically for partner’s procurement processes and capacities. This guidance provides basic principles and an inventory of possible risks and measures that can be used specifically in the context of procurement processes conducted by Helvetas partners/contracted parties.

Furthermore, Helvetas offices should identify gaps and adjust their internal processes as much as possible to comply with the principles of this guide.

All control and risk prevention activities performed by Helvetas aim to ensure proper and efficient use of donor funds. The activities described in this guide are focussed on:

• reducing the risk of fraud and corruption in the procurement process led by Helvetas partners/contracted parties, and
• ensure good quality of the outcomes

All activities should be performed according to the principles of empowering and facilitating the partner/contracted party. The control and risk prevention activities performed by Helvetas should be done with an approach of supporting the partner/contracted party in reducing risks and improving procurement processes without taking over the responsibility.

All review, control and risk prevention activities should be used in a feedback loop for further capacity building and support for improving the procurement processes of the partner/contracted party.

It should be noted that this document does not provide a ‘one fits all’ approach and that other risks and good practices may be applicable depending on the context. Thus, this guide should be carefully analysed, adjusted, and applied by Helvetas offices and projects according to their own situation, specific country context and regulatory framework.

The guide is structured in two layers:

1. The collaboration layer discusses possible risks and measures to consider when setting up a relationship at the beginning and when assessing the agreed commitments at the end of a collaboration.
2. The activity layer discusses the risks and measures to consider in relation with the procurement activity that is performed by the partner/contracted party.

The structure of the document follows a process of establishing a collaboration with a partner/contracted party, starting from the initial assessment up to the closure of the project. However, it should not be read as a linear process. The user should critically review the risks in each step and refer to earlier or later steps of the process to ensure that omissions are not made that may have serious repercussions during the establishment and implementation of the project. Notwithstanding, attention needs to be paid to the steps with the biggest risks.

“Partnerships” and other types of collaborations

• “Partners”: Not every collaboration is called a partnership (!). A “partnership” implies a close cooperation whereby two or more actors work together for a common goal with a mid- or long-term perspective. Partnerships include compatibility of values, complementarity of roles and a formal partnership agreement signed. Helvetas further distinguishes between strategic, implementation and system partners.
• “Service providers” have specialised capacities or expertise that is needed for project implementation. They are contracted to deliver short-term tasks based on specific terms of references. They are selected through procurement procedures.
• “Assisted organisations” are actors in the system that benefit directly from the project intervention (for instance a municipality).

This document does not enter into the specifics of these different types of collaborations but focuses on the situations when these “contracted third parties” have to conduct procurement processes within the frame of the activities of the project. This third party can either be a partner, service provider or assisted organisation. It can be a public, private or civil society actor. The term “partners/contracted parties” is used in this guide interchangeably to refer to these third parties.

For more on partnership and the different types of collaborations and actors involved in programme cycle management, see Helvetas Partnership policy (https://pamoja.helvetas.org/display/Directorate/Our+Partnership+Approach) and Helvetas Partnership Guidelines (https://pamoja.helvetas.org/display/Directorate/Partnership+Guidelines

This guidance can in this respect also be used as part of the “partnership management cycle”, in particular at the time of the due diligence process and the partnership appraisal stage. It provides additional guidance to the partnership appraisal tool and further details the dimensions to be analysed under section 7.3 of the partnership appraisal tool (https://pamoja.helvetas.org/display/Directorate/Institutional+Minimum+Criteria+-+Partner+Appraisal).