Forum Syd General Conditions General Conditions for Sida funds to Swedish NGOs channelled via Forum Syd Approved by: Maria Kempe, Head of Project Support Decided on: 2013-01-25 Updated: 2013-01-25 Effective as of: 2013-01-25 Editor: Maria Kempe, Head of Project Support Published: Intranet, external website
Contents Background... 3 Definitions... 3 1. Implementation... 4 2. Applications... 4 3. Budget approval and the co-funding component... 4 4. Administration grants... 4 5. Agreements... 5 6. Requisitions and payment of funds... 5 7. Management of funds... 5 8. Repayment of funds... 6 9. Reporting on results, financial accounting and reporting... 6 10. Audit of grants... 7 11. Procurement regulations... 8 12. Improper use of funds... 9 13. Miscellaneous... 9 Appendix 1 Format for Assignment description for audits... 10 Appendix 2 Procurement regulations for NGOs... 12 1) Basic principles for procurements made with Forum Syd funds... 12 2) Basic rules... 12 3) General rules regarding selective and open tendering... 13 4) Exceptions... 13 Examples of general exceptions... 13 Example of an exception from competitive procurement... 14 Examples of exceptions from good business practice... 14 5) Environmental and legal aspects of procurements... 14 6) Documentation and filing... 14 7) Forum Syd s audits and inspections: documentation requirements... 14 Appendix 3 Forum Syd s anti-corruption policy... 15 2/18
General Conditions Background These General Conditions and their appendices are valid for Swedish NGOs awarded funding from Sida, via Forum Syd, as regulated by: - Sida s instructions for Grants from the budget item Support via Swedish Civil Society Organisations (March 2010, amended July 2010, revised April 2012) - Sida s instructions for Grants for the Information and Communication Activities of Swedish Civil Society Organisations (June 2010, revised September 2012) These General Conditions have been adopted by Forum Syd s head of project support and are valid as of January 2013 for all agreements signed with Forum Syd with regard to funding from Sida s as regulated by the above instructions for 2013 and onward. Definitions Sida defines a Civil Society Organisation (CSO) as an autonomous organisation that is characterised by voluntariness, that has a degree of independence from national and local government and the market, and that conducts its activities on a not-for-profit basis, often on the platform of a common set of values. Forum Syd equates the term CSO with Swedish NGO, which refers to a non-profit organisation, registered religious community, incorporated association or foundation with a board and written, approved statutes. 3/18
1. Implementation These General Conditions regulate funding from Sida, via Forum Syd, to Swedish NGOs, irrespective of which Sida/Forum Syd budget item is affected. The Conditions represent part of an NGO s agreement with Forum Syd. In addition to this are instructions for each appropriation as regards applications, results reports, financial reports and final reports. 2. Applications Instructions for each objective/budget item state the necessary content of applications. They also state the requirements to be fulfilled by the applicant organisation in accordance with Sida s requirements and regulations. The general demand on applicant organisations is that they strive to promote development on democratic grounds. Similarly, the projects for which funding is sought must also promote development on democratic grounds. Applications shall contain a description of the applicant organisation, the activity for which the grant application is made, and a budget divided into separate items in accordance with the nature of the activity. An applicant organisation is required to have fulfilled its obligations regarding any previously made agreements with Forum Syd. Applications shall be signed by at least two authorised signatories. 3. Budget approval and the co-funding component An approved budget shall be adhered to. In the event of any major departure form the planned activities the organisation shall consult Forum Syd. Any changes in a budget item greater than 10% and significant changes in project direction, length or financing shall be discussed in advance with, and have the written approval of, Forum Syd. The budgeted amount for administration in Sweden shall not be exceeded. The Swedish NGO is required to pay a co-funding component that amounts to at least 10% of a project s total budget and that has been collected through fundraising activities in Sweden. An organisation s own or raised material goods, the value of its own work, income from the sale of services financed by public funds, grants from abroad or funds from other sources of public funding 1 may not be included as part of a co-funding component. Should another grant organisation have to approve the use of its grant as part or all of the co-funding component for projects funded by Forum Syd, written attestation of this from the organisation in question might be required, and might be subject to examination during the annual audit of the project. 2 4. Administration grants Administration costs are costs incurred by the management of funds channelled via Forum Syd (e.g. the costs of producing applications and reports, regular follow-ups and the annual audit of the total funding from Forum Syd). For such administration costs, Forum Syd provides a flat-rate grant of 8% 1 Grants from national, regional or local government. 2 This might apply, for example, to the Relief Fund of the Swedish Television and Broadcasting Corporation or Save the Children 4/18
of the total grant provided. The administration grant is exempt from the co-funding requirement and is regulated in instructions or agreements specific to the grant. 5. Agreements A Swedish NGO that transfers Sida funding to another NGO/partner in Sweden or abroad is required to enter an agreement with that partner before any approved funding may be disbursed. Such an agreement shall comply with Forum Syd s guidelines and templates, and shall include a clause stipulating that the partner is also obliged to observe these guidelines or more comprehensive terms pertaining to the NGO with which the NGO is obliged to comply vis-à-vis Forum Syd. Further, the agreement shall contain a clause regarding its repayment obligation that concurs with the repayment stipulations contained in the agreement between the Swedish NGO and Forum Syd. Forum Syd must be in receipt of any such cooperation agreement by no later than six months after the date of the agreement between Forum Syd and the Swedish NGO. The above is also applicable to successive organisations further down the chain. The Swedish NGO has responsibility towards Forum Syd for ensuring and guaranteeing full compliance with such an agreement by the signatory partner(s). 6. Requisitions and payment of funds Approved grants are paid out in advance by Forum Syd in accordance with original requisition orders on condition that the prescribed reports on previous grants/part payments (if relevant) have been received. Each order for funds shall be accompanied by a report on the funds disposed during the period up to that which the submitted order concerns. The transfer of funds to NGOs/partners in Sweden or abroad shall be effected via the Swedish and international banking system in amounts necessary for the related activities. Such a transfer may not be made until an agreement has been approved by Forum Syd and signed by both parties, and a copy submitted to Forum Syd. A written and signed requisition is required for such a transfer of funds, for which the recipient organisation must issue a receipt. Funds may not be transferred in the form of cash or by any other means than within the international banking system. Forum Syd must be in receipt of the first requisition for funds between January and June of the first year of the programme/project and once an agreement has been entered into by Forum Syd and the Swedish NGO, unless otherwise agreed with Forum Syd. Approved grants not requisitioned before the end of the budget year for which they have been granted will be forfeited, unless otherwise agreed with Forum Syd. 7. Management of funds The Swedish NGO shall keep funding received from Sida and approved by Forum Syd in a separate bank account in order to monitor fund use. Such accounts shall be signed for jointly by at least two authorised signatories from the NGO. If an interest-bearing account is used, the interest is to be stated in the financial report, but may be used for any activities approved by Forum Syd. The Swedish NGO shall ensure that the recipient organisation in the project country shall keep the funding including the co-funding component in a separate bank account disposed of jointly by at least two authorised signatories from the organisation. 5/18
8. Repayment of funds Any approved grant that is not utilised for its designated purpose shall be entered into the accounts and repaid to Forum Syd. Swedish NGOs that use interest-bearing accounts are required to report interest earned on Sida funding paid out by Forum Syd. Interest earned may be used for the Sida-funded activities within the project period. Unused grants shall be repaid in connection with the final reporting of a project. Amounts totalling less than SEK 500 need not be repaid. The correct sum to be repaid shall be attested by the auditor. The end recipient organisation in the project country may keep any earned interest for use for the Sida-supported activities as regulated in the agreement with the recipient organisation in the project country. 9. Reporting on results, financial accounting and reporting Grants shall be detailed and reported to Forum Syd. Reports and accounts shall be drawn up and submitted in accordance with the prevailing instructions, reporting forms and agreements regulating approved grants. Swedish NGOs are required to present an annual financial report detailing the use of grant funds up to that point in time. Such reports are the responsibility of an organisation s executive, and shall compare outcome with agreed budget for the current reporting period and present the accumulated outcome (if the project has been running for more than one year). Reports shall specify accrued interest and shall in all other respects comply with Forum Syd s and Sida s guidelines as regards content and structure. Swedish NGOs in receipt of Sida grants shall comply with generally accepted accounting principles in Sweden and shall clearly state any funding that has been transferred to other parties. Recipient organisations in project countries are required to comply with generally accepted national accounting and taxation regulations. Reported costs must be derivable from the accounts. The financial report shall specify the accounting principle applied (cash basis or accrual basis). Any departures from the generally accepted accounting principles shall be stated and justified. Complete supporting documents verifying costs in a project (receipts, invoices) shall be made available. Financial reports shall be signed by two authorised signatories. Reports, accounts and other relevant documentation shall be made accessible to Sida, auditors appointed by Sida, Forum Syd and auditors appointed by Forum Syd for a period of 10 years following final financial payment. Costs for personnel: Where wage/salary costs are incurred in a project, the financial report shall show the principles used in their distribution. Reliable routines shall be in place permitting the monitoring and auditing of all work hours charged to a programme. Wage/salary costs shall be recorded on a continual basis during the implementation of a project in order to promote sound monitoring practices. Grants transferred to local partner organisations: 6/18
Swedish NGOs shall ensure and guarantee that the recipient organisation in the project country maintains proper and complete accounts and that it is able to use and report on the Swedish grant in accordance with the agreed budget and activity plans. Result and financial reports from recipient organisations in project countries shall be used by Swedish organisations as the basis of their own result and financial reports. Reports from local organisations are only to be submitted to Sida or Forum Syd on request. A Swedish NGO s financial report shall provide an account of the sums transferred to other parties (local organisations in the global South and East, or another Swedish organisation). The NGO shall certify that all funds so transferred have been audited in accordance with these conditions and that it has acted on information emerging from audit reports. An NGO shall include substantial shortfalls in its report to Forum Syd and certify that it has incorporated Forum Syd s regulations into underlying agreements. 10. Audit of grants Swedish NGOs are responsible for ensuring that the use of funds is audited annually by an external, independent and qualified auditor. The audit of grants up to SEK 50,000,000 requires an approved auditor; grants totalling in excess of this amount require an authorised auditor. Audits shall be conducted in accordance with the International Standards in Auditing (ISA) issued by the International Federation of Accountants (IFAC). Swedish NGOs are required to use the appended assignment ToR for audits (Appendix 1) and have their choice of auditor approved by Forum Syd before commencing. 3 Audit costs shall be budgeted and paid for by the organisations. Auditors shall express their opinion in their report in accordance with ISA 805 as regards whether the submitted financial report corresponds to the Swedish NGO s accounting records and Forum Syd s instructions for financial reporting (which include the reporting form and relevant parts of this document). The auditors report shall include a statement to the effect that the audit has been conducted in accordance with the International Standards in Auditing (ISA), observations that the auditor has made during the audit process, and an account of whether the Swedish NGO has taken reasonable steps with regard to earlier audit recommendations. Regardless of the essential sum that the auditor chooses and works from, all deviations discovered by the auditor and not remedies by the Swedish NGO regarding monies classed as disbursements to partners further down the chain shall also be stated in the report. The auditor shall record all communication on essential issues with the board or organisation executive as regards her/his examination of the financial report and submit it in a management letter, which shall also state if the Swedish NGO has taken any measures based on the issues raised by the auditor in the previous year s management letter. The Swedish NGO is required to submit its auditor s report to Forum Syd in connection with the submission of its annual financial report to Forum Syd as per agreement. The Swedish NGO shall also 3 The Swedish NGO need not submit a new approval certificate or the like; by signing an agreement with Forum Syd, it undertakes to use the auditing ToR appended to this document, which Forum Syd deems sufficient as regards the approval of an auditor. 7/18
draft a response containing its opinions, decisions and planned measures to accompany the auditor s report to Forum Syd. The Swedish NGO is required to collaborate with and assist Forum Syd in the event of any supplementary audit, follow-up and financial studies that might be requested by Sida or Forum Syd. Sida and Forum Syd have the right to visit, audit and/or evaluate each project or activity financed partially or entirely with Sida funding channelled via Forum Syd. Sida and Forum Syd should consult the Swedish NGO concerned before making any such visits, audits and evaluations, although they reserve the right to carry out unannounced spot checks. In cases where the Swedish NGO transfers funding to a local organisation, the recipient organisation shall ensure that the funding is audited annually in accordance with the above requirements. There shall be an unbroken chain of audit reports up to and including the final recipient organisation. Current audit directions, where applicable, shall be passed on to the next organisation along the chain. The Swedish NGO s responsibilities with regard to the control of audits by subsequent partner organisation are: - To assess the auditor. - To check that the audit report from the auditor is submitted as per agreement. - To assess the auditor s report and act upon the information contained therein. 11. Procurement regulations Swedish NGOs always have the responsibility for procurements made by themselves or by their partners with Forum Syd funds. The basic principle is that, while consideration shall be given to making the procurement as economical and appropriate as possible for the organisation and for the organisation that shall receive the goods or service, all procurements financed by development cooperation funds shall be characterised by good business practice, competition and objectivity. This means that NGOs purchasing goods and services with grants from Forum Syd shall observe good business practice in their procurements. Where competition exists it shall be utilised. Tenders and tenderers shall be treated objectively in order to achieve competition on equal terms. General rules (see Appendix 2 for explanation) a) Simplified Tendering shall be done for all procurements (goods and services) above the value of 50,000 SEK excluding VAT. b) Selective Tendering shall be done for all procurements (goods and services) above the value of 300,000 SEK excluding VAT. c) Open Tendering shall be done for all procurements (goods and services) above the value of 2,000,000 SEK excluding VAT. For procurements outside Sweden the threshold values shall be adopted to local situations. When these principles are applied by either Forum Syd or their partners outside Sweden the principles shall be adopted to relevant threshold values. The threshold values mentioned above shall be translated to amounts in relevant currency that corresponds to equal value of goods/services in Sweden. The threshold values in SEK cannot be exceeded. For frequent procurements of the same type of services, the procurements during one fiscal year should be merged and procured on one occasion, or a framework agreement should be procured. 8/18
For full procurement regulations, see Appendix 2. 12. Improper use of funds The Swedish NGO shall strive to combat corruption during the implementation of the project. Forum Syd s anti-corruption policy (dated 7 November 2011) is valid for Swedish NGOs carrying out development cooperation activities with support from Forum Syd. Forum Syd s anti-corruption policy is included here as Appendix 3. The Swedish NGO shall expressly forbid its personnel, recipient organisations and their personnel, as well as consultants in projects/programmes financed by Sida, from receiving or accepting the promise of, requesting or submitting, promising or offering, for themselves or on behalf of others, bribes or other improper rewards, recompense, compensation, improper gain or advantage of some form that may constitute illegal or improper behaviour. The Swedish NGO shall actively strive to prevent, combat and reveal all forms of illegal or improper dealings or other forms of wrongful use of funds. The Swedish NGO shall immediately inform Forum Syd of all such use of funds in any activity under this agreement that comes to its attention, and state as soon as possible the steps it has taken accordingly. The Swedish NGO shall thereafter be in continuous consultation with Forum Syd regarding the issue at hand, and shall draw up a final report to Forum Syd once the issue has been concluded. If the improper use of funds is suspected by Sida/Forum Syd, Sida/Forum Syd reserves the right to conduct a special audit of the project/activity. If the audit gives reason to suspect the improper use of funds, Forum Syd reserves the right to terminate the agreement with immediate effect and to demand the reimbursement of all disbursed funds. 13. Miscellaneous All information material and activities financed in whole or in part by Sida shall be accompanied by the following text: This material has been wholly or partly financed by Sida, the Swedish International Development Cooperation Agency. The opinions conveyed are not necessarily shared by Sida. Responsibility for the contents lies exclusively with the author(s) of the material. The logotypes of Forum Syd or Sida may not be used in any context, in Sweden or in the partner country, without the prior written consent of Forum Syd/Sida. An overseas organisation awarded funding from Sida for major projects is obliged to keep the relevant Swedish official representatives regularly informed of its activities. Swedish NGOs shall keep themselves continually updated on the policies, principles and rules governing the Sida budget item from which the funding in question derives, e.g. through contact with officers on the Forum Syd or Sida website. Swedish NGOs shall be regularly available for advice on policies, principles, rules and capacity development from Forum Syd and help ensure that such advice can be given. 9/18
Appendix 1 Format for Assignment description for audits I. Introduction [ORG] has obtained a grant of X thousand SEK from Forum Syd to finance a project/programme called XX. The project/programme shall be carried out during 201X-201X. [ORG] is also channelling funding to YY. The purpose of the project/programme is. The overall objective is. [ORG] wishes to engage the services of an auditing firm for the purpose of auditing the project/programme X, as stipulated in the agreement between [X] and Forum Syd. The audit shall be carried out in accordance with internationally accepted audit standards issued by the International Federation of Accountants (IFAC). The audit shall be carried out by an external, independent and qualified auditor. II. Objectives and scope of the audit - The auditor shall examine the Financial report for period January-December 201X as submitted to Forum Syd and express an opinion in accordance with ISA 805 on whether the financial report of ORG s project/programme as submitted to Forum Syd corresponds to [ORG] s accounting records and agreed budget and Forum Syd s instructions for financial reporting. - The auditor shall examine, assess and report on compliance with the terms and conditions of the agreement and applicable laws and regulations. - The auditor shall examine whether the funds are kept in a separate account and whether this account is signed for jointly by at least two authorised signatories. - The auditor shall examine whether fund transfers to partner organisations have been made against the receipt of signed requisitions (scanned copies accepted) and whether receipts of such funds have been issued by these partner organisations. - The auditor shall examine whether the collection of the co-financing contribution complies with the terms laid out in section 3 Budget approval and the co-funding component of Forum Syd s General Conditions. - The auditor shall submit an audit report containing the findings made during the audit process and stating the measures that have been taken as a result of previous audits and whether measures taken have been adequate for dealing with reported shortcomings. - The auditor shall examine wither [ORG] has agreements with the organisations to which it channels parts of its funding and whether [ORG] has followed Forum Syd s audit instructions and has satisfactory routines/resources in place for acting upon received audit reports from these organisations. Note that this paragraph is applicable only if ORG channels a portion of its funding to another organisation. 10/18
III. Auditor s report The auditor s report is to comprise two documents, an audit report and a management letter, for submission to ORG. The report shall contain assurance that the audit has been performed in accordance with international standards and by a qualified auditor. The report shall contain the responsible auditor s signature (not just the audit firm) and title and shall be written in English or Swedish. Xx copies of the report are to be submitted to ORG. Audit report - The audit report shall state whether the audit has been conducted in accordance with ISA 805 on whether the financial report corresponds to the organisation s accounting records and agreed budget and Forum Syd s instructions for financial reporting. The report shall state that the audit has been conducted in accordance with ISA 805 and in accordance with Forum Syd s audit instructions. - Regardless of the essential sum that the auditor chooses and works from, all deviations discovered by the auditor and not remedies by ORG regarding monies classed as disbursements to partners further down the chain shall also be stated in the report. Management letter - The auditor shall record all communication on essential issues with the board or organisation executive and submit it in a management letter. If the auditor has no observations to report, this shall also be recorded in the management letter. - When relevant, the management letter shall also state if ORG has taken any measures based on the issues raised by the auditor in the previous year s management letter. - The report shall include details of the audit method used and the scope of the audit. I hereby confirm adherence to the terms, implementation and points of this assignment description: Place and date: Signed: Name in block capitals: Title and company name: 11/18
Appendix 2 Procurement regulations for NGOs Principles for Procurement Forum Syd 1) Basic principles for procurements made with Forum Syd funds All development cooperation activities shall be characterised by efficient use of resources, promotion of good administrative practices and transparency in the management of funds, and the hindrance of corruption and irregularities. One way of achieving this is by making transparent and cost-efficient procurements. These principles for procurement are valid for both Forum Syd and for partners whose activities are financed by grants from Forum Syd. NGOs always have the responsibility for procurements made by themselves or by their partners with Forum Syd funds. The basic principle is that, while consideration shall be given to making the procurement as economical and appropriate as possible for the organisation and for the organisation that shall receive the goods or service, all procurements financed by development cooperation funds shall be characterised by good business practice, competition and objectivity. This means that NGOs purchasing goods and services with grants from Forum Syd shall observe good business practice in their procurements. Where competition exists it shall be utilised. Tenders and tenderers shall be treated objectively in order to achieve competition on equal terms. 2) Basic rules a) Simplified Tendering shall be done for all procurements (goods and services) above the value of 50 000 SEK excluding VAT. Simplified tendering is a less strict procurement that does not need to be open. Written price comparisons shall be made from at least three providers and the decision shall be documented in writing. The procurement is not done in free competition, but good business practice shall still be observed. b) Selective Tendering shall be done for all procurements (goods and services) above the value of 300 000 SEK excluding VAT. Selective tendering means that at least three providers shall be invited in writing to submit written tenders. See further rules in chapter 3 below. c) Open Tendering shall be done for all procurements (goods and services) above the value of 2 000 000 SEK excluding VAT. Open tendering means that all interested providers are able to submit tenders and the assignment shall be notified in public. In all other aspects, the rules in chapter 3 shall be followed. For procurements outside Sweden the threshold values shall be adopted to local situations. When these principles are applied by either Forum Syd or their partners outside Sweden the principles shall be adopted to relevant threshold values. The threshold values mentioned above shall be translated to amounts in relevant currency that corresponds to equal value of goods/services in Sweden. The threshold values in SEK cannot be exceeded. For frequent procurements of the same type of services, the procurements during one fiscal year should be merged and procured on one occasion, or a framework agreement should be procured. 12/18
3) General rules regarding selective and open tendering 4 Complete and explicit tender documentation in the form of technical specifications/terms of reference and commercial conditions shall be included in invitations to tender. It is important that specifications are neutral and, where reference to a certain brand or trade name is necessary or similar shall be added. In the evaluation of tenders, consideration may only be given to criteria specified in the invitation to tender. Tender accepted shall be the one considered to be most advantageous when all the criteria are taken into consideration. Tenders may not be invited merely for purposes of comparison. An organisation invited to submit a tender shall also expect to actually be considered as a supplier. Invitations to tender shall be sent to at least three parties, or advertised. The composition of group of providers invited to tender should not remain permanently the same, but should as far as possible be varied from time to time. In all procurements made with the aid of tenders, the acceptance of a tender and the reasons for its acceptance shall be specified in a special procurement decision which shall be signed by the person responsible for the procurement. Tenderers whose tender has been accepted shall be informed of this in writing as soon as possible and no later than during the period of time when tender is binding for the tenderer. Tenderers whose tenders have not been accepted shall be informed of this as soon as possible. It can be considered reasonable that requirements must be adapted to circumstances prevailing locally and to local legislation in respect of procurements. However, it shall always be the case that procurements are conducted in accordance with good business practice. For Forum Syd s own procurement there is an internal handbook describing how the different types of procurement shall be carried out. 4) Exceptions In exceptional circumstances there may be cases in which the organisation considers itself obliged to make departures from the rules for competitive procurements. In such cases documentation principle applies, i.e. departures from the rules shall be justified and documented. Documentation shall be in reasonable proportion to amount in question. Examples of general exceptions Exceptions may be permitted in cases where the organisation s share of total project budget is small and not clearly discernible. A Swedish NGO acting through an international alliance or network which, in turn, has documented procurement rules can choose to follow the rules established by this party or in a documented approach to procurements by the organisation. The same applies to cooperation with the EU. 4 There are more detailed instructions for Forum Syd s own procurements in Purchasing and Procurement Procedures 13/18
Example of an exception from competitive procurement An exception from the rules on competitive procurements may be permitted in an acute disaster project, when a possible additional cost may be weighed against the fact that the goods are available for immediate delivery in country or region concerned. In situations where it is not possible to find at least three providers. Forum Syd and its partners work in difficult environments where it sometimes can be impossible to find three providers. If this is the case, as many providers as possible shall still be contacted and the contacts shall be documented. Examples of exceptions from good business practice Restrictions in respect of good business practice can be justified as a result of participation in a trade blockade recommended by the UN. Another reason for not accepting lowest acceptable tender can be in cases in which tenderer has failed to observe generally accepted trade practices and engagement of this supplier would damage the organisation s relations with its members and donors. 5) Environmental and legal aspects of procurements A sustainable use of natural resources and protection of the environment is basic within all Forum Syd s work. The organisation shall ensure that all procurements take environmentally sustainable development in consideration and providers shall supply their goods/services in the most environmentally friendly way possible. The organisation shall make sure that all procurements give due consideration to basic human rights as expressed in the ILO s core conventions 5. Providers breaking basic human rights are not accepted. 6) Documentation and filing All relevant documentation pertaining to procurements shall be kept by NGO and retained on file for a period of ten years from the date the project / programme is reported completely. Relevant documentation includes, in particular, invitation to tender, tenders, tender evaluation record, and decision. It also includes reasons and decisions forming basis of any departures made in accordance with paragraph 4 above. Forum Syd shall when deemed necessary be allowed to consult partner s relevant documents. 7) Forum Syd s audits and inspections: documentation requirements Forum Syd s responsibility includes following up and examining procurements for development cooperation purposes which are financed by Forum Syd. These types of procurements shall therefore be systematic and well documented. Forum Syd has the right to inspect all documentation pertaining to these types of procurements. 5 Freedom of Association and Protection of the Right to Organise Convention, (Nos. 87 and 98), Forced Labour Convention, (Nos. 29 and 105), Minimum Age Convention, (Nos. 138 and 182), Equal Remuneration Convention, (Nos. 100 and 111) 14/18
Appendix 3 Forum Syd s anti-corruption policy Forum Syd s Policy to counteract Corruption Areas of application Forum Syd s anti-corruption policy is applicable to all its operations and shall be applied by all employees. The anti-corruption regulations also apply to Forum Syd s partners and to organisations engaged in development cooperation with support from Forum Syd. Background Corruption, in Forum Syd s meaning of the term, is the acquisition of undue or improper gain 6 by someone or something an organisation, institution, company or individual through the exploitation of position. This includes such phenomena as bribery, extortion, favouritism/nepotism, conflict of interest, deception and embezzlement. Corruption is a form of power-abuse. Corruption is a serious hindrance to a country s development. It is one of the single most important causes of the inequitable distribution of resources in many countries. It hinders the democratization process and renders government and society inefficient. At the same time, underdeveloped democratic institutions and a weak democratic culture provide an environment in which corruption is allowed to flourish. Corruption in development cooperation undermines its effectiveness and denies poor people its benefits. Fighting corruption in society and in development cooperation is an important building block in efforts for a just and sustainable world. Corruption violates the organisation s basic values, such as justice, dignity, integrity, transparency and accountability. Forum Syd s fundamental principle is to reject corruption in all its forms, and always to act upon and inform others about suspected corrupt practices. Never accept Always act Always inform The application of this principle can sometimes lead to short-term, localized difficulties, such as the delay, hindrance or total obstruction of operations. Compared to the damage that corruption causes in society and to organisations and individuals these are consequences that the organisation is prepared to accept. 6 The word gain is to be interpreted in a broad sense to include advantages other than merely financial (influence, status etc.) 15/18
Forum Syd has two goals in relation to corruption: To avoid and fight incidents of corruption in its own organisation. To actively help to combat corruption in the countries and contexts in which it persists. The following principles are essential to the fight against corruption in development cooperation: Transparency Development cooperation should be transparent and open as regards policy, strategies, plans, decisions, reports and financial matters. Without transparency, corruption is impossible to combat. Allowing insight into the organisation strengthens control and builds confidence amongst employees, donors and partners, as well as the people whom the organisation is there to help. Accountability A necessary part of anti-corruption measures is for people and organisations to be held accountable for their actions by the people/groups that have entrusted them with leading operations. Clear, well-documented decision-making structures and mandates, as well as administrative structures that share functions of accountability and control are essential to effective accountability. Participation it is also essential to all anti-corruption measures that the target group and other relevant groups genuinely own and have influence over all relevant processes of development cooperation. Participation shall be based on principles of non-discrimination, and be inclusive, taking account of the fact that it can be difficult for some individuals and groups to take part owing to their sex, ethnicity, age, income etc. Transparency, accountability and participation are not only principles that should be fundamental to the design and implementation of development cooperation. They are also in themselves important objectives for development cooperation. Areas of application Forum Syd s anti-corruption policy is applicable to all its operations and shall be applied by all employees. Forum Syd s managers shall ensure that its employees are kept sufficiently informed of its anti-corruption policy and that it is applied to all activities. Forum Syd shall ensure that both grant-receiving Swedish organisations and its local partners are all familiar with its anti-corruption policy. Forum Syd shall ensure that all documented procedures, guidelines and forms that contribute to the prevention of corruption in its operations are known and applied within the organisation. The Policy shall be applied in processing and following up of activities and projects. The risk of corruption shall be analyzed and identified risks must be handled. The Policy shall always be applied in procurements and in agreements with partners and suppliers. Forum Syd shall always act in cases of suspected corruption and shall ensure that there are clearly defined procedures and systems for handling suspected incidents of corruption. Forum Syd s employees shall remain alert to corruption and report suspected cases of malpractice at work. Forum Syd s efforts to prevent and handle corruption takes place at several different levels and branches of its operations, which is governed by internal manuals, routines and guidelines. 16/18
It is incumbent upon all partners and others who cooperate with Forum Syd to apply these regulations on anti-corruption in development work for which they receive a grant from Forum Syd. 7 Forum Syd s partners shall: inform the relevant officer(s) at Forum Syd of each incident of suspected corruption in their own development cooperation work inform their partners about Forum Syd s anti-corruption regulations act upon suspected cases of corruption Anti-corruption Code of Conduct The organisation denounces all forms of corruption, a stance that shall be reflected in the conduct and actions of all employees and elected representatives. Elected representatives and employees shall not exploit their position in Forum Syd for their own or a third party s gain in their relations with employees, partner organisations or other individuals/groups. Elected representatives and employees shall not participate in making decisions nor prepare decisions in cases where his/hers impartiality can be challenged. It is prohibited to, for yourself or others, receive or allow to be promised, request or submit, promise or offer bribes or other improper rewards, recompense, compensation, improper gain or advantage of some form that may constitute illegal or improper behaviour. Neither elected representatives nor employees may accept gifts from colleagues, partners or other individuals or groups, unless the gift is of insignificant value and an appropriately modest expression of appreciation. No representative of the organisation shall take part in activities that lead to personal gain. Elected representatives and employees shall not commit the organisation, financially or otherwise, unless such action falls within the scope of their decision-making powers of authority. Employees shall handle funds and material to which they are entrusted with care, and shall be prepared to account for such funds or material at any time. 7 Regulated in the agreement between Forum Syd and the Swedish organisation in question. 17/18
This policy is complemented by guidelines and checklists of a more practical nature. Implementation and evaluation The Board of Forum Syd decides on the Policy to counteract corruption. The Secretary General is responsible for the yearly evaluation of the Policy. The financial controller is appointed by the Secretary General as responsible for yearly coordination and evaluation of the implementation of the Policy to counteract corruption. Strategic action plans and evaluations of this Policy shall be documented in writing and incorporated into the organisation s day-to-day operational planning and evaluation work. More information Forum Syd s guidelines on Handling cases of suspected corruption Procurement principles Handbook on preventing corruption How Forum Syd operates 18/18