BUSINESS INTEGRITY MANAGEMENT SYSTEM

TRAINING MANUAL

First Edition 2002

Electronic Edition

Federación Panamericana de Consultores

Panamerican Federation of Consultants

Fédération Internationale des Ingénieurs-Conseils

International Federation of Consulting Engineers
Internationale Vereinigung Beratender Ingenieure
Federación Internacional de Ingenieros Consultores
 Contents

Preface

Introduction

1. Analysis of the firm 3

1.1 Nominating a BIMS Committee 3
1.2 Understanding and characterising the firm 3
1.3 Review of existing Integrity Management procedures 4
1.4 Review of the firm’s status with respect to ISO 9001:2000 4

2. Designing the BIMS 5

2.1 Formulating the Code of Conduct 5
2.1.1 Contents of a model Code of Conduct 6
2.1.2 General requirements for a BIMS 6
2.1.3 Enhancing the corporate integrity culture 7
2.1.4 The components of business integrity conduct 7
2.2 Identification of the critical processes for integrity compliance 8
2.2.1 Potential wrongdoing to be avoided 9
2.2.2 Control of potential conflict of interest 10
2.2.3 Designing the integrity control methods 10
2.3 Designing and preparing the BIMS documentation 11
2.3.1 Statement of the Integrity Policy 11
2.3.2 Business Integrity Management Manual 12
2.3.3 Procedures Manual 13
2.3.4 Consulting Project Integrity Record Files 14
2.3.5 Control of documents and records 15
2.4 Senior management review and the approval of manuals 15

3. Training for BIMS 17

3.1 Awareness training of staff 17
3.2 Training of key BIMS operating personnel 17
3.3 Training of the Internal Auditor and the BIMS Manager 18

4. Implementation 19
4.1 Start up of BIMS operation 19
4.2 Implementing the Internal Auditor function 19
4.3 Implementing the Management Review Procedure 20
4.4 Changes, adjustments and continuous improvement of the BIMS 20

5. External Certification 21
5.1 Selection of the External Auditor 21
5.2 Pre-audit visit 21
5.3 Full BIMS audit 21
5.4 A new Business Integrity Management standard 22

Appendix A - Glossary of Terms 23

Appendix B - Model Code of Conduct 25

Appendix C - Integrity Review Form

Errata
This electronic edition corrects several minor errors in layout as compared to the printed edition. The only
significant editorial error is an incorrect numbering of ISO 9001:2000 clauses on Page 13.
 Preface
The BIMS Training Manual is a complement to
FIDIC’s Guidelines for Business Integrity Management in
the Consulting Engineering Industry, published in 2001.
FIDIC’s objective in preparing this manual is to help
member firms planning to run a BIMS by clearly illustrating
the steps to follow in the design, training, implementation
and certification of their own integrity management
system based on the ISO 9001:2000 standard.
FIDIC’s 2001 Annual Conference in Montreux
reported on the first implementations by consulting firms
of certified Business Integrity Management Systems.
In the aftermath of the conference, new support from
several Member Associations has prompted a variety
of consulting firms, both large and small, and from
developed and developing countries, to implement their
Corruption wins no more than honesty ....
William Shakespeare, The Tempest
own systems. The need to expose corporate
wrongdoing throughout the world will most likely
continue to be an incentive for more corporations to
design and implement tighter corporate governance, and
to establish Business Integrity Management Systems
along the lines of FIDIC’s BIMS.
This first edition of the BIMS Training Manual
has been prepared and edited by FIDIC’s Integrity
Management Task Force under the chairmanship of Dr.
Felipe Ochoa, Mexico, and including Stan Kawaguchi,
USA, Fatma Çölasan, Turkey, and Dr. Jorge Díaz-Padilla,
Mexico. FIDIC’s Integrity Management Task Force wishes
to acknowledge FOA Consulting, Mexico, for sharing its
registered BIMS in the preparation of this manual.
 Introduction
Implementing the Business Integrity Management System: the tasks
This Training Manual has been prepared to help staff
who have the responsibility for developing and implementing a
BIMS within their consulting firm.
Consulting firms already running an ISO 9001 based
Quality Management system, and are planning to explicitly
include the scope of integrity as an extension, which is part of
the way to do business, will benefit from using the guidelines
presented in this manual.
In the absence of a quality management system, a
consulting firm interested in implementing directly the scope of
business integrity for consulting projects may use this manual
if it wishes to operate a documented preventive system that
acts against against potential wrongful activities within the firm
or in interactions with clients and subcontractors.
Requirements for business integrity
The FIDIC Guidelines for Business Integrity
Management in the Consulting Engineering Industry call for
firms to operate in compliance with the following
requirements:
Bribery
Non-engagement in offering, promising, or giving a
payment, gift or other advantage directly or indirectly to a
public official or private client as undue consideration to
influence selection, execution or compensation procedures.
Extortion
Non-engagement in threatening any public official or
private client, his family or property in order to influence
selection or compensation procedures, or the execution of an
assignment.
This manual for implementating a Business Integrity
Management System provides a step-by-step procedure to
facilitate comprehension of the process.
The workflow chart for the total process comprises
five phases in sequence for developing and implementing the
system, and includes 18 specific and distinct tasks.
Tasks pertaining to each of the various BIMS
development phases will be addressed in the following
chapters.
This manual also provides specific
recommendations as to how the consulting firm can develop
each task to comply with the ISO standard.
Fraud
Non-engagement in the misrepresentation of data,
factors or qualifications to meet the terms of contract during
the selection or execution of a project, or during the
distribution of project funds.
Collusion
Non-engagement in actions among bidders
designed to influence the bidding process and prevent the
client from conducting a fair and open process.
1
 Introduction

Developing a BIMS: the process

The FIDIC Guidelines for Business Integrity Steps for BIMS implemention Workflow
Management in the Consulting Industry proposed an From the FIDIC Guidelines for Business Integrity chart
eight-step analytical model for developing and Management in the Consulting Industry

implementing a BIMS that is intended to facilitate 1 Formulation of a Code of Conduct 2.1

comprehension of FIDIC’s proposal for integrity 2 Formulation of the Business Integrity Policy 2.1
management. For training purposes, this manual 3 Appointment of a firm’s BIMS Representative 1.1
provides a more practical process description. The table 4 Identification of requirements for the BIMS 2.4
below illustrates the relationship between the two 5 Analysis and evaluation of current practices 1.3
processes. 6 Implementation tools for the BIMS 2.3
7 Documentation 2.3
8 Analysis of current practices 2.3

Implementing a BIMS: the workflow chart

2
 1 Analysis of the firm

1.1 Nominating a BIMS Committee

Senior management must nominate a BIMS
Committee to provide evidence of its commitment to the
design and development of a Business Integrity Management
System and to the continuous improvement of the system.
Members of the BIMS Committee, individually or
with the support of external consultants, will be responsible
for the design phase of the Business Integrity Management
System.
Senior management and the BIMS Committee
appointed by management must approach the design and
implementation of a Business Integrity process with a long-
term commitment and as an ongoing obligation that fails
within the firm’s normal operating procedures. They must also
assure the availability of resources.
The BIMS Committee will have to identify and
recommend to senior management the person responsible for
implementing the BIMS.

1.2 Understanding and characterising the firm

Understanding and characterizing the firm will be
particularly important for the BIMS design phase in order to
simplify the system and yet assure integrity.

Geographical scope of work Subcontractors and establishing strategic alliances

The complexity of the BIMS will vary depending on
whether the consulting firm operates locally, within one
country or globally.
Scope of services
A multi-service firm may have to customise
procedures to fit the various services, while a specialized firm
might be able to have a procedure that applies to all projects.
Type of client
Consulting firms from signatory countries of the
international OECD anti-bribery convention that compete in
consulting projects abroad will have to take the convention into
consideration when designing the BIMS.
If subcontracting, or establishing strategic alliances
or joint ventures is a common practice for the consulting firm,
provisions to disclose the firm’s policy and BIMS structure to
their associates or subcontractors will have to be made.
The firm may choose to use only subcontractors
having a BIMS in place. If a subcontractor or strategic ally
without a BIMS is engaged by the consulting firm, the contract
should include provisions to automatically disengage the
consulting firm from its ally should the partner manifest any
irregular conduct or wrongdoing.

There are countries where not only the international

convention but also local laws such as the 1977 United States
Foreign Corrupt Practices Act have to be complied with when
providing consulting services abroad. This fact has also to be
considered in the BIMS design phase.

For private clients, the firm may either follow the

same procedures as for government procurement, or establish
a simplified procedure.

3
 1 Analysis of the firm
1.3 Review of existing Integrity Management procedures
Consulting firms operate on the basis of a
business culture that can be expressed as follows:
1 No previous concern with Integrity Management.
2 The firm manages on the basis of values, with an
implicit integrity programme imbedded in the firm’s
operation.
3 An explicit integrity programme is operational but it is
not necessarily ISO 9001 oriented.
4 The firm operates an implicit or explicit integrity
programme as well as an ISO 9001 Quality
Management system.
1.4 Review of the firm’s status with respect to ISO 9001:2000
Since the BIMS protocol follows the ISO
9001:2000 standard, firms having an ISO 9001 Quality
Management system in operation will benefit
substantially if it is considering implementing a BIMS.
If a Quality Management system is in place,
extending its scope to include business integrity will
imply only a marginal cost for its implementation, and
reduced difficulty for its documentation.
4
If an explicit or implicit system is in place, an
inventory has to be carried out and an appraisal made of
how the system compares with the proposed BIMS
protocol.
It might transpire that the measures and tools
used within the firm are adequate, and all that is needed
is to make them explicit and subject to documentation
and continuous improvement. In other cases, a major
effort may be required to establish a BIMS.
If there is little in place, firms should obtain
FIDIC’S Integrity Management documents or seek
additional help from a national FIDIC Member
Association which may have programmes to provide
assistance.
Firms without previous ISO Quality
Management experience may chose to implement a
Quality Management system, including procedures for
integrity assurance.
Alternatively they may opt to implement only
the integrity assurance procedures complemented by
the six administrative procedures required by the
9001:2000 standard (see Section 2.3.2).
 2 Designing the BIMS

Tasks for designing the BIMS

Formulate Code of Conduct Design and document Senior management review

Identify critical processes
and Integrity Policy manuals and procedures and approval of manuals

• Reasons for the Code
• Irregular or illegal conduct
to avoid
• Values to enhance
• Define the Code’s
components
• Formulate the Code
• Formulate the supporting
Integrity Policy
• General acceptance by staff
• Approval and publication of
the Code of Conduct
• Identify risks factors: Project
Integrity risk
- Type of client
- Country of assignment
- New clients
- Size of contract
- Level of subcontracting
- Legal & administrative risk
- Internal functions
• Evaluate risk versus cost
of controlling
• Select critical processes for
full integrity control
• List integrity assurance • Review system and critical
procedures to be designed processes
• List specific procedures • Review manuals and other
required to be documented by documents
the ISO 9001:2000 standard • Evaluate requirements for
• Design integrity assurance implementation
method and tools for each • Evaluate training programme
procedure • Appoint BIMS coordinator
• Design forms and records • Approve manuals and
for each procedure implementation programme
• Prepare documents:
- Integrity Policy & objectives
- Integrity Management
Manual
- Procedures Manual
- Project Integrity Files
- Records document

2.1 Formulating the Code of Conduct

The Firm’s Code of Conduct is an important The requirements can be summarised as follows:
component of the BIMS. It’s a formal declaration of the values
and the ethical working rules of the firm. 1 A firm’s mission, vision and objectives should
address integrity.
The Code of Conduct cannot anticipate every
circumstance or irregular conduct that might occur. It is the 2 A Code of Conduct should be stated.
ISO approach for continuous improvement which will permit
the enhancement of the system.

BIMS is intended to assure integrity of the firm as

offered by its management and rest of the staff to its clients
and society. However, the code might also incorporate the
expected behaviour of the firm’s staff regarding integrity
towards the firm.

5
 2 Designing the BIMS

2.1.1 Contents of a model Code of Conduct

A model Code of Conduct that synthesizes a 1 Corporate integrity
number of existing codes which have been drawn up by
engineering and consulting organisations is presented in 2 Social responsibility
Appendix B. It incorporates a set of values representing
best practices for consulting work: 2 Quality of service

3 Objectivity of the firm

4 Loyal competition

2.1.2 General requirements for a BIMS

1 Objectives and goals to be achieved with the system 5 How and who will implement the BIMS

2 Risks associated with corrupt behaviour that are to 6 How sanctions will be managed
be controlled
7 Strategy for awareness and acceptance of the
3 The degree of systematization of processes to be programme
controlled
8 Criteria to opt for in the case of certification
4 Existence of a Quality Management System

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 2 Designing the BIMS
2.1.3 Enhancing the corporate integrity culture
FIDIC believes in measures to continuously improve
the productivity of member firms.
FIDIC also strongly believes that productivity
improvement should be the result of innovation - the
potential creativity of the firm - and not the result of
wrongdoing or irregular conduct.
Member firms are encouraged to enhance their
integrity culture, and to declare it as part of their mission. A
firm’s values, goals and objectives should also reflect the
integrity culture on behalf of all of the firm’s stakeholders.
The integrity culture of the firm should extend to
both the internal “customer”, namely the firm’s staff, as well as
to clients, the external customers.
2.1.4 The components of business integrity conduct
Internal integrity
Integral behaviour of the firm’s staff
Objective
To protect the firm against potential wrongful acts by staff
BIMS is mainly focused on assuring integrity in
client-firm relationships owing to its potential to enhance a
firm’s continuous improvement process.
Internal integrity assurance forms part of total
integrity. It could be addressed as a second phase of
continuous improvement, once the external integrity
component has been implemented successfully.
As part of the integrity culture, the firm’s
expectations in terms of value for all stakeholders should be
defined in order to establish what constitutes the firm’s
objectives for integrity.
The integrity culture may be defined and expressed
as part of the firm’s vision, since the vision expresses the firm’s
view forward, and the aspirations of shareholders and
employees.
External integrity
Integral behaviour of the firm vis à vis its clients and
stakeholders
Objectives
To avoid potential abuse by officials of government clients
for their personal gain.
To protect client and stockholders from potential wrongdoing
by the firm.
To protect the firm from potential wrongful acts of
subcontractors.
To protect staff from potential management wrongdoing.
7
 2 Designing the BIMS

2.2 Identification of the critical processes for integrity compliance

Business integrity shall cover all consulting
projects of the firm and a project Integrity Record File
should be kept for each project (see Section 2.3.4)
Keeping Project Integrity Record Files for all
projects may be a substantial burden for large consulting
firms operating internationally. As an alternative, firms
could include business integrity activities in their firm’s
existing procedures for projects considered “non critical”,
and keep only specific project Integrity Record Files for
projects considered to be “critical” owing to a high risk of
potential corruption.
The firm will have to decide which are the
critical projects of high potential corruption risk that
qualify for close monitoring as part of a BIMS. A project
Integrity Record File will have to be kept for critical
projects, and once the company establishes the specific
guideline, the ISO standard will accept it as long as the
firm “says what to do and does as it says”.
The following issues might be considered
when defining critical projects (see the illustration below):
1 Local, national or international services
2 Level of perceived corruption in countries being
supplied
3 Type of client: government, institutional, private
4 New or repeat client
5 Type of contract: lump-sum, cost-plus, turnkey
6 Selection mechanism: short-list bid, open bid, Quality
Based Selection, Quality-Cost Based Selection, Cost
Based Selection
7 Type of subcontracting involved

8
 2 Designing the BIMS
2.2.1 Potential wrongdoing to be avoided
A consulting firm will have to specify the corrupt
practices and potential wrongdoing that it wishes to avoid
during all phases of its workflow.
Corrupt practices may occur at various points of the
workflow. The firm may prepare a wrongdoing/work process
matrix, illustrated below, to facilitate the identification of
potential corrupt practices that are to be prevented.
The main reference, as established in the Guidelines
for Business Integrity Management in the Consulting
Engineering Industry, are the OECD anti-bribery convention
and FIDIC’s Code of Ethics that indicate the need to avoid
corrupt practices including bribery, extortion, fraud and
collusion.
Wrongdoing/work process matrices
Sub-processes of project execution
As a second step, the strategy to prevent all
identified opportunities for wrongdoing will have to be
designed, together with the tools needed to demonstrate
compliance.
The BIMS is a voluntary set of best practices
adopted by the consulting firm. However, it may also serve as
an important tool for reducing the risk of litigation.
BIMS may also prove to be the system for
demonstrating compliance with a foreign corrupt practices act
when providing services abroad in countries where such an
act exists.
9
 2 Designing the BIMS
2.2.2 Control of potential conflict of interest
FIDIC’s Code of Ethics requires that consulting
firms provide objective and unbiased advice in the interest
of the client, avoiding any potential conflict with the firm’s
own interests.
To avoid situations that might lead to illegal
conduct by the firm, the firm may decide to include
assurances that any potential conflicts of interest are
handled properly.
Non-engagement in the proper handling of
conflict between the firm’s interests and those of the
client is what has to be complied with in this situation.
In the case of an identified potential conflict
of interest, the recommended procedure for integrity
assurance includes a four-step process:
1 Disclosure to the client of the potential conflict of
interest.
2 Acknowledgment by client of the firm’s disclosure.
3 Consent from the client to proceed under certain
conditions.
4 Mitigation of potential conflict by specific actions
taken by the firm.
2.2.3 Designing the integrity control methods
Procedures have to be designed to prevent
corrupt practices during the various processes of
providing consulting services.
Internal audit level
- A signed, hand-written Integrity Review Form provided
by the internal auditor (see Appendix C).
- Records of non-conformance procedures initiated in the
case of wrongdoing or suspected irregular conduct.
Management level
- Records of procedures for corrective action, and of
sanctions in the case of wrongdoing.
10
The consulting firm should imbed in its project
integrity procedure a checklist for identifying potential
conflicts. These arise:
1 Between consulting firms and during a client’s
relationship with the firm.
Source: family relationships, or former employee
or partner relationships.
2 Between consulting assignments.
Source: assignments conflicting in their basic
characteristics, or with recommendations made by
the firm on previous assignments.
3 Between consulting services and procurement.
Source: conflicting design services and conflict in the
procurement of goods and works.
4 In the review of the work of other consultants’ work.
Source: conflict in reviewing work may imply difficulty
in undertaking an objective appraisal.
5 Between the nature of the assignment and the
principles of the firm.
Source: fundamental conflicts.
Project Manager level
- Disclosure of the firm’s Business Integrity Management
System to potential clients.
- The explicit identification of potential conflicts of
interest, and their disclosure to clients.
- An assertion that no irregular practices such as bribery
or collusion were initiated by potential clients.
- Records of actions taken in the case of suggestions by
third parties of wrongdoing.
- An assertion that irregular conduct was not initiated
either by the firm’s Project Manager or by authorized
representatives of the firm.
- A signed, hand-written form from the Project Manager
providing evidence of integrity compliance.
 2 Designing the BIMS
2.3 Designing and preparing the BIMS documentation
BIMS documentation is that which is required by the
ISO 9001:2000 standard (Clause 4.2.1) - see Guide to the
Interpretation and Application of the ISO 9001:2000 Standard
for the Consulting Engineering Industry, FIDIC, 2001.
A firm having an ISO Quality Management system in
place with all its standard documentation will only have to add
the specific procedures needed for integrity assurance of the
firm’s processes. Secondly, it will only generate new records if
existing records cannot accommodate the new procedures.
Firms planning to have an ISO-based BIMS as a first
step, without an ISO Quality Management system in place, will
have to establish the BIMS documentation from the beginning.
The following sections suggests ways to design
manuals, procedures and complementary records. Firms
already running a Quality Managment system might be
inspired to use the sections to design their required integrity
assurance procedures.
The BIMS documentation will be particularly useful
for training staff.
2.3.1 Statement of the Integrity Policy
As required by the ISO 9001:2000 standard,
a statement by senior management of the Integrity Policy
Partners’ commitment
“The firm’s partners and staff are committed to
providing quality services to their clients, with value added by
means of best practices and business integrity”.
“The firm’s objective is to satisfy the client’s
expectations and requirements by adapting quality and its
continuous improvement as its work method, and integrity as
the overriding consideration in its behaviour”.
Complementary policy statements
1. Every firm employee plays a key role in ensuring the
firm’s integrity.
2. All consultants and employees must fully understand the
ethics of serving clients.
An example of a consulting firm’s Integrity Policy
Source: Integrity Management Manual, FOA Consulting BIMS © 2001
BIMS documents
1 Integrity Policy
A formal statement specifying the Integrity Policy and its
objectives.
2 Integrity Manual
A document describing the BIMS and how the
requirements of the ISO standard are met.
3 Procedures Manual
Integrity assurance procedures and the procedures
required by ISO 9001:2000.
4 Project Integrity Record Files
Documents to ensure the effective operation and control of
the critical processes and the critical projects.
5 Records
Documents stating results achieved or providing evidence
of activities performed and compliance with specific
aspects of the ISO 9001:2000 standard.
must be drafted as one of the BIMS documents. An example
of an Integrity Policy statement is given below.
3. All consultants must trust their Project Leader whenever
the relationship with the client becomes uncomfortable.
4. The Project Leader shall guarantee that all consultants and
staff members on the project team are familiar with,
understand and comply with the firm’s BIMS.
5. The Project Leader shall ensure that throughout project
development and until project completion there is full
compliance with the firm’s BIMS.
6. All members of the firm shall seek to identify, apply and
exchange best practices for integrity assurance.
7. Every department within the firm must stipulate goals and
actions for maintaining integrity, and must seek
continuous improvement.
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 2 Designing the BIMS

2.3.2 Business Integrity Management Manual

The Business Integrity Management Manual
should describe the BIMS and how the requirements of
the ISO 9001:2000 standard are addressed.
In the event that a consulting firm decides to
extend the scope of an operational ISO 9001:2000
Quality Management system, since the BIMS complies
with the standard, the Quality Manual for the quality
system will have to be adapted to include the business
integrity aspects.
Firms designing a BIMS in the absence of a
previously implemented Quality Management system will
benefit greatly from the FIDIC Guide to the Interpretation
and Application of the ISO 9001:2000 Standard for the
Consulting Engineering Industry when drafting an
Integrity Manual.
The proposed contents for an Integrity Manual
that follow the contents of the 9001:2000 ISO standard
are presented below.

1. Introduction 7. Product Realization

7.1 Planning of production realization
2. Scope, Purpose and Field of Application 7.2 Customer related processes
7.3 (does not apply to BIMS)
3. Glossary of Terms 7.4 Purchasing
7.5 Production and service provision
4. Business Integrity Management System 7.5.1 Control of production
4.1 General requirements and service provision
4.2 Documentation requirements 7.5.2 Validation of process integrity
7.5.3 Identification and traceability
5. Management Responsibility 7.5.4 Control of client’s information
5.1 Management commitment 7.5.5 Preservation of product
5.2 Customer focus 7.6 (does not apply to BIMS)
5.3 Integrity Policy
5.4 Planing 8. Measurement, Analysis and Improvement
5.5 Responsibility, authority and communication 8.1 General
5.6 Management review 8.2 Monitoring and measurement
8.2.1 Clients’ perception
6. Resource Management 8.2.2 Internal audit
6.1 Provision of resources 8.2.3 Monitoring and test of processes
6.2 Human resources 8.2.4 Monitoring and test of services
6.2.1 Competence and Training 8.3 Control of non-conforming processes
6.3 Infrastructure 8.4 System feedback
6.4 Work environment 8.5 System Improvement
8.5.1 Continual improvement
8.5.2 Corrective action
8.5.3 Preventive action

Standard contents for a Business Integrity Mangement System Integrity manual

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 2 Designing the BIMS

2.3.3 Procedures Manual

The Procedures Manual aims to specify the person Two types of procedures have to be considered:
responsible, the tools to be used, their order of application, those that assure integrity and those required by the ISO
and the records to be generated for each of the consulting Quality Management standard.
processes in order to avoid corrupt practices at all times.

Integrity assurance procedures Procedures required by ISO 9001:2000

The ISO 9001:2000 standard calls for a number of The management review procedure must be a
procedures which are designed to conform with the integrity part of the Procedures Manual, together with the six
scope. It is up to the firm to specify and design these procedures specifically required by the standard which are
procedures (Sub-clause 4.3 of the standard). listed in the table below.

The consulting firm may choose to design a single The procedures for corrective and preventive action
procedure for each of the main processes of providing consulting require a well thought-out action plan, approved by senior
services, including marketing, bidding and contracting, project management, for adopting appropriate sanctions in the
selection, final delivery, and collection processes. various potential cases of non-conformance.

Additional functions to be controlled by integrity
management that are associated with the firm’s administrative
functions may merit their own procedures. This may be the
case for accounting and financial reporting, or for the firm’s
purchasing and supply functions.
The Procedures Manual must include details of the
forms and records to be generated for each of the procedures
that will be designed.

Other internal integrity assurance functions may

require their own procedures, as is the case for “confidentiality
of internal information” or “intellectual property integrity
protection”. These procedures may be included as part of the
continuous improvement philosophy of the standard.

Name of the procedure Reference to ISO 9001:2000 Clause

Review
1 Management Review 5.6

Procedures for Integrity Assurance (required by the firm)

2 Review of the marketing, bidding and contracting processes 4.1
3 Review of the project execution process 4.1
4 Review of the final delivery process 4.1
5 Review of the collection process 4.1

Procedures Required by the Standard

6 Control of documents 4.2.3
7 Control of records 4.2.4
8 Internal Audit 8.2.2
9 Control of the non-conformance function 8.3
10 Corrective actions 8.5.2
11 Preventive actions 8.5.3

Contents of the Procedures Manual

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 2 Designing the BIMS

2.3.4 Consulting Project Integrity Record Files

A Project Integrity Record File has to be
prepared for each of the critical projects. The file should
contain evidence that the Integrity Policy has been
implemented, controlled and monitored throughout the
various processes that encompass the consulting
services delivered.
FIDIC’s Business Integrity Management
System is based on a set of checks and balances based
on specially designed procedures, complemented by a
set of deposition or “affidavit” type documents consisting
of signed, written assertions that the procedures were
strictly followed. The proposed method hinges upon the
creation of a “paper trail” as a strategy to prevent
misconduct.
The written statements are prepared by the
Project Manager who signs off to the veracity of their
contents. Subsequently, the statements are reviewed
and autheniticated by the firm’s Internal Auditor, and
periodically by senior management. A voluntary, second-
party acknowledgment is sought from the client in order
to corroborate the integrity of the services rendered.
Periodic external audits to verify conformance of the
Quality Management system with the ISO standard have
also to be carried out.
Finally, and as a part of the ISO standard,
periodic external audits of system conformance must
be established.

1. Project description.

2. Record of disclosure of the BIMS to the client.

3. Internal Auditor’s record of the reviews of project

integrity compliance.

4. Integrity compliance record of processes.

4.1 Marketing of consulting services
- Technical and financial proposals
- Communication with the client
- Contract terms
- Project Manager’s signed, written
assertion specifying supporting
evidence that the project marketing
and contracting complied with
integrity principles.
4.2 Project subcontracting and execution
- Time schedule and activity programme
- Progress reports
- Subcontract documents and
acceptance of integrity policy
- Communication with client and subcontractors
- Project time sheets and cost accounts
including subcontracts
- Arguments justifying the modification
of contracts
- Signed, written assertion of the Project
Manager specifying evidence that the
subcontracting and project execution
complied with the Integrity Principles.
4.3 Project delivery of services and fee collection
- Final report and supporting elements
- Project Manager checklist of deliverables
- Client acceptance of contract completion
- Second-party acknowledgment of
compliance with Integrity Principles
- Invoice documentation and time for
collection statistics
- Benchmark of collection times versus
usual collection times for each type of client
- Project Manager’s signed, written
assertion with supporting evidence of
integrity compliance during the
delivery and collection processes.

Proposed contents for Project Integrity Record Files

14
 2 Designing the BIMS
2.3.5 Control of documents and records
The ISO 9001:2000 standard specifically requires
documented procedures for the control of documents and
records (Sub-clause 4.23).
Control of documents
Control of documents means having a pre-planned
specification for document identification, preparation, review,
approval, distribution, availability, storage and change.
Documents covered by this procedure include:
1 Documents describing the BIMS
implementation
2 Integrity Manual
3 Procedures Manual
4 Project Integrity Record Files
External documents such as standards, protocols
and other relevant regulations need to be identified, and their
distribution controlled. A master list of documents is required
so that current and superceded documents can be clearly and
easily identified, and so that the issue of documents can be
controlled and traced. The master list should be constantly
updated, and should include a record of changes.
2.6 Senior management review and the approval of manuals
Senior management must review the designed
system before proceeding with its implementation.
The critical processes selected for control and
monitoring, the integrity control methods, manuals and other
documents are of particular importance. They require review
and clearance by management.
Senior management will have to evaluate the
requirements for implementation as well as the training
programme.
Control of records
The control of records entails demonstrating
conformance with the standard, and with the specified
integrity requirements.
1 Records covered by this procedure include the
Project Integrity Record File plus other records
required by the standard.
2 Records demonstrating the integrity of each
process.
3 Records associated with the project (e.g.,
proposal, contract document, progress
reports, deliverables).
4 Records demonstrating the operation of the
BIMS (e.g., management review report, audit
results, non-conformance reports, integrity
competence of staff).
Important records should be kept in a secure place,
and protected from physical damage and unauthorized access.
The purpose of the management review is to
provide a strategic assessment of the Business Integrity
Management System to ensure its continuing suitability,
adequacy and effectiveness. The review must be performed
by the executive management of the firm, and should not be
delegated to subordinates.
Manuals and the implementation programme should
be approved following the successsful outcome of the
management review, and a BIMS coordinator appointed to
proceed with the implementation phase.
15
 3 Training for BIMS

Further training of employees

A key issue for the success of a Business Additional staff training is recommended. It is
Integrity Management System is that all staff become envisaged that training would cover two different
aware of the Integrity Policy and act in accordance with the aspects, namely a discussion of case studies and the
spirit as well as the letter of its documentation. discussion of themes.

Discussion of themes Case studies

Discussion of the following themes should be The following types of case study might be
considered for training programmes: presented in training:

1 Reasons for a BIMS: objectives and stakeholders. 1 Analysis and discussion of conflicts of interest and
2 The Code of Conduct how to manage them.
3 Integrity Policy 2 Analysis and discussion of wrongful acts that can
4 Irregular conduct to be avoided possibly arise in the firm’s various processes.
5 Integrity issues in the firm
6 External integrity issues relating to clients and
subcontractors
7 The value of BIMS
8 Sanctions
9 Defining improvement, and items to consider.

Selection of trainers FIDIC “Train the Trainers Programme”

FIDIC Member Associations
In-house
Contract

FIDIC’s Guidelines for Integrity Management

Trainers must have a full knowledge of BIMS
in the Consulting Industry protocol

Training must be project life-cycle oriented Marketing

Contracting
Planning
Execution
Delivery/Collection
Feedback

Training must include BIMS awareness for all staff

Specialised training must include key BIMS Requires adequate programming and records
operating and mangement personnel of compliance

Training must include rehersals with senior management

Issues for the training phase

16
 3 Training for BIMS
3.1 Awareness training of staff
The firm has to ensure that staff understand how they
participate in, and contribute to, the process of achieving the
integrity objectives.
An awareness training programme for staff must be
carried out before implementation of the BIMS.
All staff members will have to maintain a record
confirming that have undertaken awareness training. This
record will be kept by the BIMS administrator as proof of
attendance at training courses.
Incoming staff must be be introduced to the firm’s
integrity policy as soon as they are engaged.
Training will have to provide information covering at
least the following components of the system (records should
be kept of this fact):
3.2 Training of key BIMS operating personnel
The competence and value of staff in a consulting
firm have a direct bearing on the integrity and honesty
engaged in the services provided. All activities of the firm can
affect integrity: they should be performed by staff who have
the necessary training and knowledge, and who can be relied
on to make sound judgements in matters concerning integrity.
The supply of training records, job descriptions and
the personnel records of key staff members is normally sufficient
for demonstrating compliance with the human resources
aspects of the ISO Quality Management standard, and thereby
meeting the firm’s objectives for integrity management.
Compliance with the requirements can be
demonstrated through:
1 The firm’s senior management declaration of integrity.
2 Knowledge of the firm’s Code of Conduct, with distribution
of the document to staff and the maintaining of signed
records that each staff member received a copy.
3 New employees will have to acknowledge reception of
their copy of the Code of Conduct.
4 Explanation of the reasons for the firm’s integrity policy.
5 A general description of the system procedures and
their function.
6 Procedures for notifying possible violations of integrity.
1 The job descriptions of Project Managers (responsible for
the Project Integrity Record Files) that specify the required
skills based on a knowledge of the firm’s Integrity Policy
and system procedures.
2 The staff records of Project Managers that include their
training and experience with respect to the work of
maintaining the Project Integrity Files and of following the
Integrity Management procedures.
3 Training programmes which take into account the specific
needs for performing assigned tasks as well as general
training for the integrity system.
4 Management training programmes with a similar level of
content and evaluation as those used to train Project
Managers.
5 The training of Project Leaders and senior management is
needed to ensure that everyone involved understands and
properly complies with the Integrity Policy and operates
the Integrity Management procedures in all of the
processes.
17
 3 Training for BIMS
3.3 Training of the Internal Auditor and the BIMS Manager
Audits should be carried out by a staff
member, working in cooperation with relevant personnel.
The Internal Auditor, who must be certified,
can be an employee of the firm. Alternatively, the internal
audit function can be out-sourced to a quality/integrity
management consultant.
18
The auditor will have to be trained in FIDIC’s
BIMS protocol. The training course could be organised as
a service offered by the FIDIC Member Association in a
particular country through a train-the-trainers programme.
A similar approach could be followed to train
the BIMS Manager who is responsible for filing all of the
BIMS documents and records, and for supervising
compliance with all of the procedures required by the
ISO standard.
 4 Implementation
4.1 Start up of BIMS operation
Implementation should be carefully planned once
the design of the BIMS system has been approved. The
consulting firm may choose to introduce Project Integrity
Record Files for all ongoing projects of a critical nature, or only
for those contracted after the date the BIMS was initiated.
Moreover, a large firm might select a pilot implementation
phase, starting with the headquarters or a regional office and
then gradually enlarging coverage to the remainder of the firm.
4.2 Implementing the Internal Auditor function
At specified intervals, maybe monthly at the outset
and once every three to six months when the BIMS is running
smoothly, the Internal Auditor must review the operation of the
system, especially completion of the project files, to make sure
that all the prescribed procedures are being followed.
The Auditor will need to work through checklists
designed to make sure that no wrongdoing has taken place
during the various phases of the critical projects that are
subject to Integrity Management.
If steps in the procedure are missing, or if the
Auditor detects an incident that is thought to merit additional
action, the Auditor will generate a record of non-conformance,
possibly together with a recommendation for the corrective
action that will have to take place.
The Project Integrity Record Files have to be
prepared by their Project Mangers or by the designated
consultant, according to the procedures established in the
BIMS Manual. At each phase of a project, the information that
assures no wrongdoing in the process must be completed by
the designated person and signed by the Project Manager.
All documents associated with the workflow of the
consulting project must be contained in the file corresponding
to each of the specially designed control procedures that are
specified in the Manual.
The internal, or first-party, audit must be conducted
by a certified member of the staff or by a fully qualified expert
who is retained for the purpose. The audit should comprise
the following phases:
1 Planning
An audit plan and checklist of topics to be reviewed will
be prepared.
2 Conducting
The auditor reviews the results and prepares a report.
3 Reporting
The auditor reports the audit’s findings to appropriate
members of the firm’s management.
5 Follow-up and close-out of the audit results
Feed-back from the Project Manager of the action taken.
19
 4 Implementation

4.3 Implementing the Management Review Procedure

Internal monitoring requires a periodic
management review. This will assure that the integrity
system remains relevant, adequate and effective.

Management should seek an analysis of results External

derived from internal quality audits. It should act on these Monitoring by third parties audits whether “we do
reviews, and records of the reviews should be maintained. what we say”.

A direct outcome of the management review Internal

procedure should be a continuous improvement of the Internal monitoring verifies adherence to the Business
BIMS in the light of the recommendations based of the Integrity Management System.
internal and external audits.

4.4 Changes, adjustments and continuous improvement of the BIMS

Special attention should be given during The following types of actions should be
management reviews to the improvement of the Business considered to:
Integrity Management System, including detailed
consideration of recommendations made by staff. 1 Modify the procedures

Changes to be adopted should be decided as 2 Expedite the procedures

part of the management review, thus proving that there is
continuous improvement of the system. 3 Simplify the system

Continuous improvement takes into account 4 Computerize the system that manages manuals
recommendations made by third parties, including
external auditors when they perform the auditing that is 5 Widen the scope of the BIMS by including additional
prescribed in order to maintain certification of the BIMS. functions

20
 5 External certification
5.1 Selection of the External Auditor
External or third-party certification refers to an
outside body reviewing for the consulting firm that its specified
BIMS is in place, and acting to prevent corrupt practices in the
first instance, and to expose and sanction them whenever they
occur.
ISO certification has come to be widely accepted
over the past 15 years and many countries and consulting
industry clients are committed to it. Even for integrity conceived
as a component of providing quality service, the ISO
certification represents an international standard consistently
applied and verifiable by an accredited third party.
Important as it is for the firm’s external evaluation, it
is free market competition that will provide the ultimate
incentive for BIMS certification.
Considering the unpleasant surprises of a string of
large international corporations and their auditors accepting
what seems to be irregular conduct, if not delinquent, one can
see the opportunity costs of having had a certified system like
BIMS in place to prevent them, and its value when proving
compliance with a code of conduct.
5.2 Pre-audit visit
The certifying organisation may carry out a pre-audit
check before proceeding to the certification audit.
5.3 Full BIMS audit
For the full review, the external auditor will check that
all non-conformances found in the pre-audit have been taken
care of, and will examine in detail the manuals, documents and
records as well as other objective evidence of compliance with
the standard.
If no inconsistencies are found the auditor may
issue a ISO 9001:2000 Quality Management certificate with
the scope of “Business Integrity in Consulting Projects”.
When considering BIMS Certification, the first step is
to seek a reliable certification/registration body, hopefully itself
already BIMS certified, to find out what is offered, what it entails
and the likely costs of certification and its maintenance.
It is essential for the BIMS to have been
implemented and in full operation for a few months in the
consulting firm. Several months of records demonstrating the
operation of the Integrity Management System will help to
demonstrate the functionality of the implemented system.
Once the certification organization has been selected
and a formal application has been filed, the organization will
review the Integrity Manual and the Procedures Manual to
assess how well the consulting firm’s manuals describe what
should happen against what the standard prescribes.
If deficiencies are detected, the certifying
organization will indicate them for the consulting firm to amend
manuals or to develop additional procedures as needed.
The consulting firm will have to demonstrate to the
auditor how the BIMS is running and how it complies with the
ISO standard for the scope of integrity. If non-conformances
are found by the auditor the consulting firm will have to
arrange a final auditing.
Once certification is granted, the certification
organization will carry out compliance audits of the system
over the period for which the certification is valid. These audits
are not as comprehensive in that the full system is not
necessarily assessed at each audit.
If non-conformances are found during a compliance
audit, and they are not corrected within a specified time,
certification may be withdrawn. Minor non-conformances may
require correction by the next compliance audit.
21
 5 External certification
5.4 A new Business Integrity Management standard
An ISO standard on Business Integrity does
not exist at present. A new standard would have to be
developed and approved in order to cover the
assessment of a Business Integrity Management
System, and the subsequent issuing of a certificate to
confirm that the applicant is in conformance with the
standard’s requirements.
In the meantime, FIDIC has formally requested
the International Standards Organization through its
Technical Committee 176 responsible for maintaining the
ISO 9001 standard to consider the following:
1 Business Integrity Management should be given its
proper status as a feature of best practice that
facilitates the harmonization of world trade and
improvements in quality.
2 Recognize that the Guidelines for Business Integrity
Management in the Consulting Industry published by
FIDIC in 2001 exist and may be used as a qualified
reference document in relation to the ISO 9000 family
of Quality Management standards.
3 Business Integrity Management is an integral part of
the processes used in providing consulting services
so it is compatible with the process-oriented
concepts of ISO 9001:2000.
A certification strategy for the short term
Consulting firms participating in a BIMS pilot
programme set up by FIDIC for its member firms have
followed an accepted strategy for certification, pending
official recognition of the BIMS protocol.
Since integrity is part of quality, the strategy
calls for implementing BIMS in accordance with the ISO
standard on Quality Management, and duly certifying the
consulting firm in Quality Management with the scope of
“Business Integrity in Consulting Projects”.
22
4 FIDIC requests that it be adequately recognized for
the development of the Guidelines for Business
Integrity Management in the Consulting Industry
should the ISO Technical Committee 176 consider it
in its interest to pursue the document as a suitable
basis for a new international standard on Business
Integrity.
ISO has a provision for the standardisation of
quality management in specific sectors at the request of
the interested sector, and with the support of ISO’s
Technical Management Board. This is the basis for a
FIDIC approach to ISO to publish a complement to ISO
9001 with a specific field of application, the outcome
being an ISO/FIDIC standard applicable to integrity
assurance in the consulting industry.
The request is in line with ISO’s guideline 72
that calls for avoiding the proliferation of management
standards and the admittance of those harmonized with
the ISO 9001 standard, as is the case for FIDIC’s BIMS
protocol. It is anticipated that the request will to be
reviewed in depth by ISO’s Technical Management
Board.
Once the BIMS protocol is accepted as part of
the standard, the ISO certification of consulting firms will
be in “integrity management”.
The first firm to obtain a ISO 9001:2000
Quality Management certificate within this scope
belonged to FIDIC’s Member Association in Mexico.
Other consulting firms from Mexico, Turkey and the
Nordic countries are following a similar route, pending
the ISO/IEC TC-176 committee’s ruling on the BIMS
protocol.
 Appendix A
Glossary of Terms

Integrity The total set of values, attitudes and attributes of a firm which may enable a rigid
adherence to a code of ethics and behaviour.

Code of Conduct The explicit expression in actions of the firm’s ethical behaviour and of its
integrity values.

Business Integrity Policy The concept, approach and objectives of a firm with respect to business
integrity, as formally defined and expressed by management.

Business Integrity Management System The organizational structure, responsibilities, procedures, processes and
resources implemented in a firm to accomplish management by integrity.

BIMS ISO 9001:2000 Compliance When the firm’s implementation of BIMS meets the six components of the
ISO 9001:2000 standard recommended by FIDIC for the consulting
engineering industry.

BIMS Certification Third-party evaluation process attesting that a firm’s specified BIMS is in place
and is acting to prevent corruption and to expose and sanction corruption
whenever it arises in the firm.

23
 Appendix B
Model Code of Conduct for consulting firms

It is expected that the experience of member
firms of FIDIC, the International Federation of Consulting
Engineers, and FEPAC, the Federation of Pan-American
Consultants, from around the world can contribute to the
development of a model Code of Conduct that would be
clear, simple and easy to communicate, and capable of
being applied uniformly.
The present Guidelines propose a model Code
of Conduct that synthesizes a number of existing codes
that have been drawn up by engineering and consulting
organisations. It draws on the most important issues and
incoporates the main best practices for consulting work,
namely Business Integrity, quality and technnology
development.

Being a common code, it would apply to all

member firms. Individual firms would adopt regulations
and procedures to fit their operations in order to
implement the Code of Conduct aspects of a Business
Integrity Management System.

Social responsibility Objectvity of the firm

1 The firm acccepts continuing responsibility for its
consulting services before its clients and society.
2 The firm shall permanently contribute to the benefit of
its clients and Society, through sustained personnel
training and technology, development aimed at
improving productivitiy.
3 The firm will include sustainability as a permanent
goal in every project.
Quality of service
4 The firm shall only undertake project assignments in
its areas of expertise, where it has the capabilities to
deliver efficient and effective service to its clients.
5 The firm is committed to providing high quality
services to clients. The firm will focus on Quality
Management as a working methodology, and on
permanent improvement as a means to improve the
quality of service.
7 The firm will act with loyalty to its clients, and
maintain the confidentiality of any information from
the client that is obtained in the process of
performing its services. The firm will also keep
confidential the documents and reports prepared
for a client.
8 The firm shall avoid and conflict of interest, and will
inform a client beforehand of any potential conflict
of interest that could emerge during the execution
of consulting services.
9 The firm will only offer its services under contracting
terms that do not interfere with its independence,
integrity and objectivity.
10 The firm will not accept any remumeration that could
encourage the firm to offer a biased opinion.

6 The firm is committed to the continuing improvement

of its knowledge base, abilities and tools in its area of
expertise. The firm will focus on technology
management as a working methodology, and shall
extend to its clients the benfits of its professional
achievements.

24
 Appendix B
Model Code of Conduct for consulting firms
Corporate integrity
11 The firm will only solicite consulting work and participate in
private or public competitive bidding under the highest
standards or corporate ethics and competitive practices,
and with total integrity in its transactions.
12 The firm will act at all times for the benfit of clients, and
will carry out services with professionsl integrity, while not
jeopardising the interests of society.
13 The promotional activity of the firm and its services will
uphold the dignity and reputation of the industry.
Brochures and other formal documents describing
resources, experience, work and reputation will reflect the
firm’s actual circumstances in a truthful manner.
14 The firm shall manage with integrity its internal and
external affairs. The firm will focus on Business Integrity
Management as a working methodology, consistent with
the dignity of the knowledge-based consulting industry.
Competition
15 The firm favours Quality Based Selection for the
contracting of its services.
16 If solicited to review the work performed by another
consultant, the firm will act in accordance with its business
integrity and objectivity policies.
17 The firm will not endorse compensation or contribution
arrangements destined to influence or secure consulting
work, nor seek commissions from suppliers of equipment
and services recommended to the client as part of the
firm’s consulting services.
18 The firm shall not take part in activites that could damage
the reputation or business of others.
25
 Appendix C
Integrity Review Form

Internal Audit Project Review Checklist YES NO

A Marketing and Contracting Process

1 Disclosure to the client of the firm’s Integrity Policy

Evidence of formal delivery to the client of company brochures stating the existence of
the firm’s BIMS
Integrity Policy disclosure as part of the project proposal

2 Management of potential conflict of interest

Evidence of having analyzed a potential conflict of interest checklist
Evidence of following management procedures in the case of a potential conflict

3 Integrity management during the bidding process

Proposal reflects the actual experience of the firm
Resumés of experts reflect their actual experience
Evidence that the firm was not involved in the short-listing process
Evidence that the firm did not collude with the participants
Evidence that the firm did not derive an unfair competitive advantage over competitors

4 Conditions of Contract
Conditions of Contract reflect the scope offered in the original proposal
Evidence of justifiable reasons in the case of changes to the Conditions of Contract
Evidence of action taken in the case of irregular practices initiated by the potential client
Evidence of actions taken in the case of suspected wrongdoing by associates or
subcontractors
Project Manager’s signed, written assertion, and evidence of the firm’s integrity
during the process

B Project Execution Process

5 Adequate Work Team

Evidence of adequate staffing levels and staff expertise throughout provision of
services to the client
Existence of detailed terms of reference and contracts for associates and
subcontractors

6 Contract modifications
In case of contract modification (involving, for example, contents, price, schedules),
evidence that adjustments were as indicated and justified

7 Consultant/client integrity relationship during execution

Existence of fair treatment in dealing with contractor selection, contractor
supervision and claims handling
Evidence of there being no attempts of extortion by the client’s employees during
execution
Concrete preventive or corrective measures if extortion is attempted
Project Manager’s signed, written assertion, and evidence of the firm’s integrity
during the process

26
 Appendix C
Integrity Review Form

YES NO

C Project Delivery and Collection Processes

8 Compliance with the Conditions of Contract

Evidence that actual project deliverables fulfill the contract terms
Evidence of on-time delivery of products, and failing this evidence of the formal
acceptance by the client of a time extension
Evidence of acceptance by the client of contract fulfillment

9 Contract collection
Justification in case of an earlier than agreed collection schedule
Evidence of avoidance by the firm in case of extortion attempts during collection
Project Manager's signed, written assertion, and evidence of firm’s 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 Senior Management Review:

The Internal Auditor:

27
International Federation of Consulting Engineers (FIDIC)
PO Box 311
CH-1215 Geneva 15
Switzerland
Telephone: ++ 41 22 799 49 00
Fax: ++ 41 22 799 49 01
E-mail: fidic@fidic.org
WWW: http://www.fidic.org
FIDIC Guide to Practice

The business of a professional services firm

A training manual

First issued in 2003

http://www.fidic.org/guidetopractice

Business Integrity Management Module

Available in printed and electronic formats

Published by FIDIC under agreement with The World Bank

International Federation of Consulting Engineers

World Trade Center II
Geneva Airport
Box 311
CH-1215 Geneva 15

Tel: +41 22 799 49 00 fidic@fidic.org

Fax: +41 22 799 49 01 www.fidic.org
 Contents

1 Introduction 1
1.1 Background
1.2 Outline of the manual

2 The consulting industry 5

2.1 The consulting engineering industry – an overview
2.1.1 The past
2.1.2 The present
2.1.3 The future
2.2 Meeting the challenge of the future – the expectations of the global market
2.2.1 Quality
2.2.2 Innovation
2.2.3 Responsiveness
2.3 Leadership and management
2.3.1 Empowerment
2.3.2 The new breed of leader
2.4 Ten tips on being a good leader
2.5 The way ahead
2.6 References

3 Organizing a consulting firm 13

3.1 Suggestions for a start-up firm
3.2 Types of ownership and governance
3.2.1 Types of ownership
3.2.2 Governance of the firm
3.3. Types of practice
3.3.1 General practice
3.3.2. Interprofessional practice
3.3.3. Architect-engineer relationships
3.3.4. International practice
3.4 Laws and regulations
3.5 Culture and ethics

4 Administration and organization of the firm’s activities 21

4.1 Organizational structure
4.2 Office space and equipment
4.3 Insurance
4.4 Standard procedures
4.5 Standard contracts
4.6 Indicators for administration
Appendix 4A – Recommended telephone techniques

FIDIC Guide to Practice – The business of a professional services firm ii

 5 Business development 27
5.1 Marketing
5.1.1 Strategic planning
5.1.2 Establishing a marketing plan
5.1.3 Marketing tools
5.1.4 Public relations programme
5.2 Identifying opportunities
5.3 Sales - the pursuit of individual projects
5.3.1 Project delivery methods
5.3.2 Procurement of consulting services
5.3.3 The prequalification stage
5.3.4 The proposal stage

6 Human resources management 59

6.1 Recruiting and classifying staff
6.1.1 Skills inventory
6.1.2 Job descriptions
6.1.3 Employee types
6.1.4 Methods of recruiting
6.1.5 Mechanics of recruiting
6.1.6 Terms of employment
6.1.7 Orientation of new employees
6.2 Remuneration
6.2.1 Salary administration
6.2.2 Benefit administration
6.3 Employment terms and conditions
6.3.1 The employment agreement
6.3.2 Conflict of interest
6.3.3 Termination – voluntary and involuntary
6.4 Staff management
6.4.1 Motivation
6.4.2 Training and professional development
6.4.3 Performance appraisal
6.5 Policies and procedures
6.6 Health and safety
6.7 Equity participation
Appendix 6A - Typical generic (job type) job descriptions
Appendix 6B - Sample internal forms
Appendix 6C - Sample letters
Appendix 6D - Typical human resource management procedures

7 Financial Management 103

7.1 Accounting systems
7.1.1 Introduction
7.1.2 Accounting system
FIDIC Guide to Practice – The business of a professional services firm iii
 7.1.3 Audit
7.1.4 Internal financial controls
7.2 Typical financial structure
7.2.1 Introduction
7.2.2 Balance sheet and income statement
7.3 Management information systems
7.4 Invoicing and collections
7.4.1 Methods of compensation
7.4.2 Invoicing
7.4.3 Collection of Accounts Receivable
7.5 Financial planning
7.5.1 Business planning and budgeting
7.5.2 Cash flow management
7.5.3 Debt financing
7.6 Contracts and the financial manager
7.7 Risk management and liability insurance
7.8 Investment issues
7.8.1 Dividends
7.8.2 Investments
7.8.3 Firm valuation and transfer of ownership
7.9 Indicators for financial management
7.9.1 Profitability ratios
7.9.2 Liquidity ratios
7.9.3 Solvency or stability ratios
7.9.4 Staff utilization
7.9.5 Other ratios
Appendix 7A – Accounting systems

8 Client relationships and communications 135

8.1. Introduction
8.1.1 Trusted partner
8.1.2. Quality - schedule – budget: the impossible triangle
8.2 Building on client relationships
8.2.1 Individuals as clients
8.2.2 Companies (corporations) as clients
8.2.3 Governments as clients
8.2.4 Manufacturers as clients
8.2.5 Relations with employees of the client
8.2.6 Identifying and handling problems
8.2.7 Crisis management
8.3 Relationships with contractors and suppliers
8.3.1 Contractors
8.3.2 Suppliers
8.3.3 Suppliers providing engineering services
8.4 Communications with clients

FIDIC Guide to Practice – The business of a professional services firm iv

 8.4.1 The proposal
8.4.2 Business letters
8.4.3 Notes of meeting
8.4.4 E-mails
8.4.5. Instant messaging
8.4.6. Bulletin boards, blogs and portals
8.4.7 Verbal communications
8.4.8 Presentation of project results

9. Sustainable development 151

9.1. The need for sustainability
9.1.1. Origins of the concept
9.1.2. A unsustainable course
9.1.3. The precautionary principle
9.2. Principles of sustainable development
9.2.1 Production-consumption model
9.2.2. Other concepts
9.2.3 Organizations
9.3. Sustainable development and the professional service firm
9.3.1. Long-term benefits
9.3.2. Driving force in the marketplace
9.3.3. Sustainable procurement
9.3.4. The benefits of a commitment
9.3.5. Matching client needs
9.3.6. Approaching clients
9.4. Building a sustainable development business culture
9.5. Project delivery
9.5.1. Project delivery methodology
9.6. Accepting the challenge
References
Appendix 9A - Organizations

10 Risk management 175

10.1 Introduction
10.2 Identifying the risk
10.2.1 Clients and fees
10.2.2 Offer and acceptance
10.2.3 Obligations
10.2.4 Review of third-party design
10.2.5 Indemnities, collateral and liability
10.3 Limiting the liability
10.4 Minimising the likelihood
10.4.1 Quality management
10.4.2 Responsibility
10.4.3 Bids and proposals

FIDIC Guide to Practice – The business of a professional services firm v

 10.4.4 Conditions, scope and fees
10.4.5 Design - Build
10.4.6 Design variation
10.4.7 Human resources
10.4.8 Communication

11 Quality management 187

11.1. Introduction
11.1.1. The concept of quality management
11.1.2. What is quality
11.2 The need for and benefits of quality management
11.3. ISO 9000 family of standards
11.4 Development and implementation of a quality management system
11.4.1. Commitment of senior management
11.4.2. System development and implementation
11.5 Sustaining the quality management system
11.6. Certification
11.6.1. The certification process
11.7. Examples of standard procedures in a professional services firm

12 Business integrity management 199

12.1 Concept
12.2 Principles
12.3 Developing the system
12.3.1 Nomination of the BIMS Committee
12.3.2 Code of conduct
12.3.3 Policy
12.3.4 Representative
12.3.5 Analysis
12.4 Implementation
12.4.1 Start-up
12.4.2 Internal audit
12.4.3 Management review procedure
12.4.4 Modification and continuous improvement
12.5 Documentation
12.5.1 Control system
12.5.2 Business Integrity Management Manual
12.5.3 Procedures Manuals
12.5.4 Project Integrity Record Files
12.5.5 Control of documents and records
12.6 Management review
12.6.1 Management Commitment
12.6.2 Approval of manuals
12.6.3 Resources
12.7 External review and certification

FIDIC Guide to Practice – The business of a professional services firm vi

 12.7.1 First Party
12.7.2 Second Party
12.7.3 Third Party
12.8 Training
12.8.1 Staff Awareness
12.8.2 Key operational personnel
12.8.3 BIMS Manager
12.8.4 Internal auditor
12.9 Pitfalls to Avoid
Appendix 12A FIDIC Code of Ethics
Appendix 12B FIDIC Business Integrity Management System

Annexes
A1 Integrated performance measurement 227
A1.1 Introduction
A1.1.1 Reasons for introducing performance measurement
A1.1.2 Challenge
A1.1.3 Barriers to implementation
A1.2 Integration
A1.2.1 Balanced set of measures
A1.2.2 Strategic alignment
A1.2.3 Horizontal integration – automated performance measurement
A1.3 Implementing an integrated performance management system
A1.3.1 Commitment
A1.3.2 Clarify vision, strategy, goals, objectives and critical success factors
A1.3.3 Define the measurement framework
A1.3.4 Balanced frameworks
A1.3.5 Implementation steps
A1.4 Performance measures
A1.4.1 Identification
A1.4.2 Types
A1.4.3 Tests
A1.4.3 Sources
A1.5 Audit, review and benchmarking
A1.6 Maintaining the system
A1.7 Indicators
A1.7.1 Selection
A1.7.2 Input productivity
A1.7.3 Outcome effectiveness
A1.7.4 Output measures as substitutes for outcome measures
A1.8 Benchmarks
A1.8.1 Approaches
A1.8.2 Types
A1.8.3 Good practice matrices
A1.8.4 Confidentiality protocol for benchmarking clubs
FIDIC Guide to Practice – The business of a professional services firm vii
 A1.9 Performance dashboards
A1.10 Baselines

FIDIC Guide to Practice – The business of a professional services firm viii

 12. Business Integrity Management

12. Introduction
There has been a dramatic change of attitude towards corruption since the early 1990’s, when it
became evident that corruption is extremely harmful to development. This change of attitude was due not
only to an increase awareness of widespread corruption, but also because of a perceived increase in the
systemic financial risk that was building up as a natural consequence of economic globalisation. These
factors gave rise to the first successful international initiatives against corruption.
The work of the OECD, which was initiated in 1989 by the USA, brought the issue of corruption
to the centre of public attention. The rationale was initially driven by a first-world agenda: to establish a
level playing field for commerce among the major worldwide competitors, by ensuring that corruption
did not become a market barrier. The OECD recommendation of 1994, in which industrialized nations
pledged to reduce the supply-side of bribery worldwide, was a catalyst for other initiatives. It became the
seedbed for the 1997 OECD Convention on bribery which was co-signed by 34 countries.
Also crucial was the move by The World Bank in 1996 to redefine its policy on corruption, and to
take a much more proactive stance in public statements, and in procurement guidelines for everyday
practice. Shortly afterwards, the International Monetary Fund, the World Trade Organization, and other
regional development banks, such as the Inter-American Development Bank and the Asian and African
Development Banks, began focusing on ways to reduce corruption.
A formal effort by FIDIC to identify specific courses of action that could lead to reduced
corruption in consulting began in 1998. This led to the proposal to develop a practical tool, namely a
comprehensive Business Integrity Management System (BIMS) for consulting firms. An Integrity
Management Task Force was mandated by FIDIC’s Executive Committee to develop such a system.
The Task Force presented its initiative to the multilateral banks during the 1999 Biennial Meeting
of the International Lending Agencies with the Consulting Industry (BIMILACI). The World Bank
endorsed the initiative, and proposed the creation of a Joint Working Group on Integrity (JWGI) under
FIDIC’s leadership, with the Interamerican Development Bank and the Federation of Pan-American
Consultants (FEPAC) joining the Group at the same time. The JWGI worked on the development of the
guidelines for a business integrity management system which were presented in a 2001 FIDIC document
entitled FIDIC Guidelines for Business Integrity Management in the consulting industry. The JWGI also
developed a recommended action plan to be pursued by the international funding institutions to support
the work of FIDIC and FEPAC member firms. A further document entitled Business Integrity
Management System Training Manual was published by FIDIC in 2002.
In view of the pursuit of the world-wide harmonization in standards, and the removal of barriers
to international trade in services based on the International Organization for Standardization standards,
the BIMS proposed by FIDIC is structured to reflect a standards-based approach. This allows for the
possible eventual proposal of a BIMS standard if the development of such a standard proves to be both
feasible and advisable. It also allows firms to develop a BIMS that can be integrated into their quality
management system. Just as quality management improves the viability and sustainability of a consulting
practice, a well-designed and implemented BIMS will add value to the consulting practice and to its
clients.
Important as it is for the firm’s protection, it is free market competition that will provide the
ultimate incentive for BIMS implementation and possible certification by ISO. Considering the
unpleasant surprises of firms and their auditors apparently accepting irregular conduct, the benefits are
clear of having a certified system like BIMS in place to prevent them, and its value when proving
compliance with a Code of Conduct.

12.2. Requirements for business integrity

The FIDIC Guidelines for Business Integrity Management in the consulting industry call for
firms to operate in compliance with the following requirements:
FIDIC Guide to Practice – The business of a professional services firm 199
 - Bribery: Non-engagement in offering, promising, or giving a payment, gift or other
advantage directly or indirectly to a public official or private client as undue
consideration to influence selection, execution or compensation procedures.
- Extortion: Non-engagement in threatening any pubic official or private client, his family or
property in order to influence selection or compensation procedure, or the
execution of an assignment.
- Fraud: Non-engagement in the misrepresentation of data, factors or qualifications to
meet the terms of contract during the selection or execution of a project, or
during the distribution of project funds.
- Collusion: Non-engagement in actions among bidders designed to influence the bidding
process and prevent the client from conducting a fair and open process.
A business integrity management system will demonstrate that the firm has complied with the
above requirements. Procedural documents inform staff what is expected of them, and are supported by
evidence provided by project files and verified by a thorough audit process.

12.3. The principles of business integrity management

FIDIC has identified a number of principles for business integrity management. Each of these
principles is a comprehensive and fundamental belief for operating an organization, aimed at preventing
corruption in any of its forms, be it bribery, extortion, fraud or collusion.
12.3.1 Leadership
The Board of Directors and the Chief Executive Officer (CEO) of the firm must demonstrate, in a
clear and visible way, that they are fully committed to Business Integrity Management. The commitment
must be evident to all staff, in words and deeds. The CEO must lead in the initial steps, in the formulation
of the Code of Conduct and in the allocation of resources to the business integrity management initiative.
Most importantly, the CEO must demand that the BIMS be adhered to. There should be no
misunderstanding that top management demands compliance with integrity values, and is prepared to take
the necessary actions for achieving integrity.
12.3.2. Involvement of staff
The involvement of every employee is critical to the successful implementation of business
integrity management in a consulting firm. Every task in the day-to-day operation of a firm, and in the
conduct of professional services, includes staff who have to commit to business integrity, and focus on it
in their responsibilities.
Synergy, where the whole is greater than the sum of the parts, is an important element of business
integrity management. Synergy can be developed by generating trust and a positive environment within
which to work. A working environment committed to business integrity empowers staff.
Effective communication is essential to the successful implementation of business integrity
management in a consulting firm. The prerequisite for successful teamwork is that all the parties involved
obtain and maintain the same understanding of the project while it is being carried out. This requires
appropriate communication and coordination.
12.3.3. A process approach
The holistic nature of business integrity implies that each of the processes performed by a
consulting firm to provide a service must be accomplished with integrity. The identification of potential
opportunities for corruption, and the control of all processes, are important activities in a consulting firm.
Preventative measures to avoid all types of potential corruption require information related to the
administrative management of each activity. The information must be recorded, and it must be available
on an “on request” basis. The storage and retrieval of this information, on either a short-or a long-term
basis, requires an organized and consistent approach. In a consulting engineering firm, the typical
sequence of activities for a major project is as follows:
FIDIC Guide to Practice – The business of a professional services firm 200
 - Marketing of engineering services
- Engineering design or project execution
- Preparation of tender documents and specifications
- Prequalifying and evaluating tenders
- Supervision of those responsible for construction
- Issuing of payment certificates to contractors
- Decision-making on contractors’ claims
- Purchase of equipment and supplies by the consulting firm
- Delivery of service fees and collection
- Accounting and preparation of financial statements.
12.3.4. A documented process
Business integrity must be documented for it to be managed. Documenting information should be
a continuous process, rather than taking place on a single occasion, which runs the risk that important
events will be missed. Management should periodically analyse and review the business integrity
management system, to ensure its continued suitability and effectiveness, and to keep it permanently
updated. Appropriate methods must be developed to monitor the business integrity Management System,
and to identify corrective actions that may be required to assure business integrity in all phases of the
consulting process.
Auditing is a procedure that subjects randomly chosen aspects of the firm’s business to detailed
examination. If described protocols exist as part of an implemented business integrity management
system, the defined conditions are monitored. Comments on ways to improve the audit may be added.
Management is made aware of the results, and must decide on corrective measures, if indicated to be
necessary, and the level of resources to be committed.
It is necessary for the BIMS to obtain external or client feedback. This can be done by:
- Client evaluations: Client evaluations may be solicited in a number of ways, including a
direct inquiry asking for comments on specific issues, or through an
easy-to-complete questionnaire.
- Debriefings: Conducing follow-up debriefings on proposals, won or lost, and on
completed assignments.
- External audit: Commissioning an external audit, not necessarily for certification
purposes, but to obtain an independent evaluation of the BIMS.
- Peer review: Peer reviews assist the firm in identifying areas that require further
attention.

12.4. Developing the system

Most consulting firms are “doing their best” to define and implement anticorruption policies. But
while firms establish their own procedures to assure business integrity and fight corruption, many lack
consistency in the day-to-day implementation of anticorruption policies, and fail to obtain systematic
feedback which may improve the Business Integrity Management process. What is missing is a
framework that can be used to connect and transform isolated acts of integrity assurance into a complete
management system. Figures 12.1 and 12.2 illustrate the components and interrelations of a BIMS, and
the sequence of events for developing a BIMS. For such a system, the formal procedures of a BIMS may
be helpful in identifying potential risks, preventing and combating corruption, and implementing business
integrity policies for every project throughout the entire organization.
Developing and implementing a BIMS for a consulting firm can be done in a step-by-step
fashion, each involving clearly defined tasks.

FIDIC Guide to Practice – The business of a professional services firm 201

Figure 12.1: The process components for an operation BIMS

12.4.1. Implementation steps

Step 1 - Formulation of a Code of Conduct

To ensure commitment and the upholding of the firm’s values, it is essential that the firm’s Code
of Conduct be developed under the supervision of the Board of Directors and senior management. The
firm’s code should be clear, simple and easy to communicate and apply. It should be consistent with
FIDIC’s own Code of Ethics (see Appendix 3A), and with the code promulgated by the firm’s Member
Association. Appendix 12A presents a model Code of Conduct for consulting firms. It can be customized
to meet the needs of a particular firm.

Step 2 - Formulation of the Business Integrity Policy

The requirements presented in the FIDIC guidelines for a firm’s business integrity policy are
based mainly on the OECD Convention on Combatting Bribery of Foreign Pubic Officials in
International Business Transactions and on FIDIC’s Code of Ethics.
The business integrity policy hinges upon the fact that corruption is only eliminated by across-
the-board honesty and integrity. Honesty is interpreted as being free from fraud or deception, and
integrity as conduct whereby the firm does not obtain or keep what does not fairly belong to it. The
business integrity policy should cover accountability for integrity, ensure that the requirements meet all
local rules and regulations, and that the company’s Code of Conduct is fulfilled. The business integrity
policy must be documented, implemented, communicated internally and externally and be made publicly
available.

Step 3 - Appointment of a firm’s BIMS Representative

A senior member of the firm’s management staff must be appointed as a BIMS Representative to
assure that the requirements of the system are met. A member of the consulting firm’s staff can also be
selected to allow for communication between management and staff on behalf of the internal verification
process.

Step 4 - Identification of requirements for the BIMS

The requirements of the BIMS should reflect the needs of the processes in a given firm that call
for specific actions to manage business integrity. The requirements depend on:
- Size and structure of the firm
- The nature of its consulting services
- Local and national regulations, and market forces
- The expectations and requirements of all the stakeholders.

FIDIC Guide to Practice – The business of a professional services firm 202

Figure 12.2: Implementing a BIMS - the workflow chart

FIDIC Guide to Practice – The business of a professional services firm 203

 Step 5 - Analysis and evaluation of current practices
An analysis should be made of the ways the firm currently deals with anticorruption issues in all
of its main processes. The analysis should include identifying the location of records and of areas where
appropriate documentation exists, as well as procedures or instructions describing the firm’s activities.
The gap between current practices and the requirements of the business integrity management system
should be identified. How this gap is identified and corrected will depend on past management
commitments and the policies practiced by the firm. Some organizations may have a fully compliant
business integrity system; others may have to make a start by taking steps to implement the BIMS
guidelines.
For analysing business practices, FIDIC recommends a process-oriented approach that shifts
attention from the service itself to the process of providing the service. The aim is to incorporate business
integrity considerations into the various processes that arise in providing consulting services. Figure 12.3
summarizes the critical processes and the wrongdoing potential associated with each. A business integrity
checklist that can be used by the firm to identify additional business integrity management requirements
and to conduct audits is found in Appendix 12B.

Figure 12.3: Illustration of wrongdoing potential

Step 6 - Design the BIMS

The following tools support the planning and implementation of a BIMS:
- Code of Conduct
- Business integrity policy
- Definition of roles, responsibilities and authority
- Business integrity procedures for the main processes
- Proposal bidding/negotiation
- Project execution and delivery
- Project collection

FIDIC Guide to Practice – The business of a professional services firm 204

 - Accounting structure
- Enforcement measures
- Declaration of business integrity in the annual report
Owing to the nature of consulting work, the BIMS requires the firm to establish a procedure to
evaluate subcontractors and external consultants based on their own business integrity policies, and to
keep records of the subcontractors’ and external consultants’ commitments to business integrity
management.
A BIMS must be well documented, to provide evidence that all processes that may affect the
business integrity of the services offered by the firm have been thoroughly planned and addressed. The
extent of documentation is a critical feature that will affect how readily a BIMS will be adopted by a firm.
Care should be taken to avoid over-documentation, as this may reduce interest in using manuals. It is
recommended that a BIMS be documented in a general Business Integrity Manual and, if required for
projects designated as Critical Projects, in a Project Integrity Record File.
1. Business Integrity Manual
The Business Integrity Manual may be divided into two parts:
- A policy document containing such topics as the Code of Conduct and business integrity
policy, scope of application, organizational checks, organizational responsibilities and
authorities, and references to the firm’s standard procedures.
- A document containing the standard procedures, and instructions documenting how the
identified requirements are to be fulfilled within the firm.
2. Project Integrity Record File
The Project Integrity Record File, if required for a project designated as a Critical Project:
- Identifies the “what, why, who, when where and how”. The document should specify the
specific business integrity management activities, or sequence of activities, that apply to the
particular project.
- In stating the results achieved in certifying integrity during each of the project’s processes,
the Project Integrity Record File provides evidence of the business integrity management
activities that have been performed.
12.4.2. Nomination of the BIMS Committee
Senior management should nominate a BIMS Committee or a senior officer with implementation
responsibility, to provide evidence of its commitment to the design and development of a Business
Integrity Management System and to the continuous improvement of the system. Members of the BIMS
Committee and/or the BIMS Officer, individually or with the support of external consultants, will be
responsible for the design phase of the business integrity management system.
Senior management and the BIMS Committee appointed by management must approach the
design and implementation of a Business Integrity process with a long-term commitment and as an
ongoing obligation that falls within the firm’s normal operating procedures. They must also assure the
availability of resources.
12.4.3. Understanding and characterizing the firm
Understanding and characterizing the firm will be particularly important for the BIMS design
phase, to simplify the system and yet assure integrity.
- Geographical scope of work
The complexity of the BIMS will vary depending on whether the consulting firm operates
locally, within one country or globally.

FIDIC Guide to Practice – The business of a professional services firm 205

 - Scope of services
A multi-service firm may have to customise procedures to fit the various services it offers,
while a specialized firm might be able to design a procedure that applies to all projects.
- Type of client
For private clients, the firm may either follow the same procedures as for government
procurement, or establish a simplified procedure.
- Legal environment
Consulting firms from signatory countries of the international OECD anti-bribery convention
that compete in consulting projects abroad will have to take the convention into consideration
when designing the BIMS. There are countries where not only the international convention,
but also local laws such as the 1977 United States Foreign Corrupt Practices Act, must be
complied with when providing consulting services abroad. This fact has also to be considered
in the BIMS design phase.
- Subcontractors and strategic alliances:
If subcontracting or establishing strategic alliances or joint ventures is a common practice for
the firm, provisions to disclose the firm’s policy and BIMS structure to their associates or
subcontractors must be made. The firm may choose to use only subcontractors having a
BIMS in place. If a subcontractor or strategic partner that lacks a BIMS is engaged by the
consulting firm, the contract should include provisions to automatically disengage the
consulting firm from its ally should the partner manifest any irregular conduct or
wrongdoing.
12.4.4. Review of existing business integrity management procedures
Consulting firms operate on the basis of a business culture that can be highly variable from firm
to firm:
- No previous concern with integrity management.
- The firm manages on the basis of values, with an implicit integrity programme embedded in
the firm’s operation.
- An explicit integrity programme is operational but it is not necessarily ISO 9001 oriented.
- The firm operates an implicit or explicit integrity programme as well as an ISO 9001 quality
management system.
If an explicit or implicit system is in place, an inventory is carried out and an appraisal made of
how the system compares with the proposed BIMS protocol. It might transpire that the measures and
tools used within the firm are adequate, and all that is needed is to make them explicit and subject to
documentation and continuous improvement. In other cases, a major effort may be required to establish a
BIMS.

12.5 Designing the BIMS

12.5.1. General requirements
The following key points need to be defined before designing the firm’s BIMS:
- Objectives and goals to be achieved with the system
- Risks associated with corrupt behaviour that are to be controlled
- The degree of systematisation of processes to be controlled
- Existence of a quality management system
- How and who will implement the BIMS
- How sanctions will be managed
- Strategy for awareness and acceptance of the program
- Criteria to opt for in the case of certification

FIDIC Guide to Practice – The business of a professional services firm 206

 FIDIC believes in measures to continuously improve the productivity of member firms. FIDIC
also strongly believes that productivity improvement should be the result of innovation – the potential
creativity of the firm – and not the result of wrongdoing or irregular conduct. Member firms are
encouraged to enhance their integrity culture, and to declare it as part of their mission. A firm’s values,
goals and objectives should also reflect the integrity culture on behalf of all of the firm’s stakeholders.
The integrity culture of the firm should extend to both the internal “customer”, namely the firm’s staff, as
well as to clients, the external customers. BIMS is mainly focused on assuring integrity in client-firm
relationships, at least when the BIMS is launched. However, internal integrity assurance forms part of
total integrity. It could be addressed as a second phase of continuous improvement, once the external
integrity component has been implemented successfully.
The integrity culture may be defined and expressed as part of the firm’s vision, since the vision
expresses the firm’s view forward, and the aspirations of shareholders and employees.
- Internal integrity – Behaviour of the firm’s staff
Objective: To protect the firm against wrongful acts by staff
- External integrity - Behaviour of the firm vis à vis its clients and stakeholders
Objectives: To avoid potential abuse by officials of government clients for their
personal gain
To protect clients and shareholders from potential wrongdoing by the
firm.
To protect the firm from potential wrongful acts of subcontractors.
To protect staff from potential management wrongdoing.
12.5.3. Identifying critical projects
Business integrity should cover all consulting projects of the firm and a Project Integrity Record
File may be kept for each project (see Section 12.5.6.3). Keeping Project Integrity Record Files for all
projects may be a substantial burden for large consulting firms operating internationally. As an
alternative, firms could include business integrity activities in their firm’s existing quality management
procedures (including random audits) for projects considered “non critical”, and keep only specific
Project Integrity Record Files for projects considered to be ‘critical’ owing to a high risk of potential
corruption.
The firm will have to decide which are the “Critical Projects” of high potential corruption risk
that qualify for close monitoring as part of a BIMS. A Project Integrity Record File must be kept for
Critical Projects, and once the company establishes the specific guideline, the ISO Standard will accept it
as long as the firm “says what to do and does as it says”.
The following issues might be considered when defining Critical Projects (see Figure 12.4):
- Local, national or international services.
- Level of perceived corruption in countries being supplied.
- Type of client: government, institutional, private.
- New or repeat client.
- Type of contract: lump-sum, cost-plus, turnkey.
- Selection mechanism: short-list bid, open bid, Quality Based Selection, Quality-Cost Based
Selection, Cost Based Selection.
- Type of subcontracting involved.
12.5.3. Identifying potential wrongdoing
The consulting firm will have to specify the corrupt practices and potential wrongdoing that it
wishes to avoid during all phases of its workflow. The firm may prepare a wrongdoing/work process
matrix (Figure 12.3) to facilitate the identification of potential corrupt practices that are to be prevented.
The main reference, as established in the FIDIC Guidelines for Business Integrity Management in the
consulting engineering industry, are the OECD anti-bribery convention and FIDIC’s Code of Ethics.
These identify the need to avoid corrupt practices, including bribery, extortion, fraud and collusion.

FIDIC Guide to Practice – The business of a professional services firm 207

Figure 12.4: Sample decision tree to define critical projects
* The Transparency International Corruption Perception Index identifies countries with a high (10.0 is
the maximum score) Corruption Perception Index a being relatively “clean”.

The BIMS is a voluntary set of best practices adopted by the consulting firm. However, it may
also serve as an important tool for reducing the risk of litigation. BIMS may also prove to be the system
for demonstrating compliance with a foreign corrupt practices act when providing services abroad in
countries, in jurisdictions where such an act exists.
12.5.4. Controlling conflict of interest
FIDIC’s Code of Ethics requires that consulting firms provide objective and unbiased advice in
the best interests of the client, avoiding any potential conflict with the firm’s own interest and respecting
client requirements to preserve confidentiality. To avoid situations that might lead to illegal or unethical
conduct by the firm, the firm may decide to include assurances that any potential conflicts of interest are
handled properly.
In the case of an identified potential conflict of interest, the recommended procedure for integrity
assurance includes a four-step process:
1. Disclosure to the client of the potential conflict of interest.
2. Acknowledgement by the client of the firm’s disclosure.
3. Consent from the client to proceed under certain conditions.
4. Mitigation of the potential conflict through specific actions taken by taken by the firm.
The consulting firm should imbed in its project integrity procedure a checklist for identifying
potential conflicts. These can arise:

FIDIC Guide to Practice – The business of a professional services firm 208

 - Conflict: Consulting firms and during a client’s relationship with the firm.
Source: Family relationships, or former employee or partner relationships.
Potential remedy: Exclusion of certain staff from projects
- Conflict: Between consulting assignments:
Source: Assignments conflicting in their basic characteristics, in the clients for
which they are performed, or with recommendations made by the firm on
previous assignments.
Potential remedy: Confidentiality agreements, segregation of project teams.
Conflict: Between consulting services and procurement.
Source: Conflicting design services and conflict in the procurement of goods and
works.
Potential remedy: Exclusion of the firm from certain phases of the work.
Conflict: In the review of the work of other consultants.
Source: Conflict in reviewing work may imply difficulty in undertaking an
objective appraisal.
Potential remedy: independent project team.
- Conflict: Between the nature of the assignment and the principles of the firm.
Source: Fundamental conflicts.
Potential remedy: None if a serious conflict.
Effective control of conflict of interest situations can be an important benefit of a business
integrity management system. It should elevate the status of the firm in the eyes of its clients, and help
avoid potentially serious legal and/or client dissatisfaction problems.
12.5.6. Designing integrity control methods
Formally documented Procedure Memoranda are designed to prevent corrupt practices during the
various processes of providing consulting services.

Internal audit level

- A signed, hand-written Integrity Review Form provided by the internal auditor (see sample in
Appendix 12C).
- Records of non-conformance procedures initiated in the case of wrongdoing or suspected
irregular conduct.

Management level
- Records of procedures for corrective action, and of sanctions in the case of wrongdoing.

Project Manager level

- Disclosure of the firm’s Business Integrity Management System to potential clients.
- The explicit identification of potential conflicts of interest, and their disclosure to clients.
- An assertion that no irregular practices such as bribery or collusion were initiated by existing
or potential clients.
- Records of actions taken in the case of suggestions by third parties of wrongdoing.
- An assertion that irregular conduct was not initiated either by the firm’s Project Manager or
by authorized representatives of the firm.
- A signed, hand-written form from the Project Manager providing evidence of integrity
compliance.
12.5.7. The BIMS documentation
BIMS documentation is that which is required by the ISO 9001:2000 standard (Clause 4.2.1) - see
FIDIC Guide to the interpretation and application of the ISO 9001:2000 Standard for the consulting
engineering industry. A firm having an ISO quality management system in place with all its standard
documentation will only have to add the specific procedures needed for integrity assurance of the firm’s
processes. It will only generate new records if existing records cannot accommodate the new procedures.
FIDIC Guide to Practice – The business of a professional services firm 209
Firms planning to have an ISO-based BIMS as a first step, without an ISO quality management system in
place, will have to establish the BIMS documentation from the beginning.
The following sections suggest ways to design manuals, procedures and complementary records.
Firms already running a quality management system might be inspired to use the sections to design their
required integrity assurance procedures.
- Integrity policy: A formal statement specifying the Integrity Policy and its
objectives.
- Integrity Manual: A document describing the BIMS, and how the requirements
of the ISO standard are met (if applicable).
- Procedures Manual: Integrity assurance procedures, and the procedures required by
ISO 9001:2000 (if applicable).
- Project Integrity Record Files: Documents to ensure the effective operation and control of the
critical processes for Critical Projects.
- Records: Documents stating results achieved or providing evidence of
activities performed and compliance with specific aspects of
the ISO 9001:2000 standard.

The BIMS Policy Manual

The business integrity management Policy Manual should describe the BIMS, and how the
requirements of the ISO 9001:2000 standard are addressed (if appropriate). If a consulting firm decides to
extend the scope of an operational ISO 9001:2000 quality management system, the Quality Manual for
the quality system will have to be adapted to include business integrity scope items.
The proposed contents for an Integrity Manual, following the format of the 9001:2000 ISO
standard, are presented below.
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 Planning
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 product realization
7.2 Customer-related processes
7.3 (does not apply to BIMS)
7.4 Purchasing
7.5 Product and services provision
7.5.1 Control of production and service provision
7.5.2 Validation of process integrity

FIDIC Guide to Practice – The business of a professional services firm 210

 7.5.3 Identification and traceability
7.5.4 Control of client’s 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 processes
8.4 System feedback
8.5 System improvement
8.5.1 Continual improvement
8.5.2 Corrective action
8.5.3 Preventive action

BIMS Procedures Manual

The BIMS Procedures Manual aims to specify the person responsible, the tools to be used, their
order of application, and the records to be generated for each of the consulting processes in order to avoid
corrupt practices.

Integrity assurance procedures

Two types of procedures have to be considered:
- those that assure integrity
- those required by the ISO Quality Management standard.
1. Firm procedures
It is up to the firm to specify and design the business integrity management procedures (Sub-
clause 4.3 of the Standard). The consulting firm may choose to design a single procedure for each of the
main processes of providing consulting services, including marketing, bidding and contracting, project
selection, final delivery, and collection processes.
Additional functions to be controlled by integrity management that are associated with the firm’s
administrative functions may merit their own procedures. This may be the case for accounting and
financial reporting, or for the firm’s purchasing and supply functions.
Other internal integrity assurance functions may require their own procedures, as is the case for
“confidentiality of internal information” or “intellectual property integrity protection”. These procedures
may be included as part of the continuous improvement philosophy of the standard.
2. Procedures required by ISO 9001:2000
The management review procedure must be a part of the BIMS Procedures Manual, together with
the six procedures specifically required by the standard which are listed in the table below. The
procedures for corrective and preventive action require a well thought-out action plan, approved by senior
management, for adopting appropriate sanctions in the various potential cases of non-conformance. The
BIMS Procedures Manual must include details of the forms and records to be generated by following
each of the procedures (see Table 12.1).

Project Integrity Record Files

A Project Integrity Record File must be prepared for each of the Critical Projects identified as
described in Section 12.5.2. The file should contain evidence that the Integrity Policy has been
implemented, controlled and monitored throughout the various processes that encompass the consulting
services delivered (see Table 12.2).

FIDIC Guide to Practice – The business of a professional services firm 211

 FIDIC’s business integrity management system is based on a set of checks and balances based on
specially designed procedures, complemented by a set of deposition or “affidavit” type documents
consisting of signed, written assertions that the procedures were strictly followed. The method hinges
upon the creation of a ‘paper trail’ as a strategy to prevent misconduct.
The written statements are prepared by the Project Manager who signs off to the veracity of their
contents. Subsequently, the statements are reviewed and authenticated by the firm’s Internal Auditor, and
periodically by senior management (normally represented by the BIMS Officer). A voluntary, second-
party acknowledgement is sought from the Client to corroborate the integrity of the services rendered.
Finally, if the firm is ISO certified, periodic external audits of system conformance must be
established.

Table 12.1: ISO 9001:2000 required procedures

Name of the procedure Reference to ISO 9001:2000 Clause

Review
1. Management review 4.1
Procedures for integrity assurance (required by the
firm)
2. Review of the marketing, bidding and contracting 4.3
processes
3. Review of the project execution process 4.3
4. Review of the final delivery process 4.3
5. Review of the collection process 4.3
Procedures required by the standard
6. Control of documents 4.2.3
7. Control of records 4.2.4
8. Internal audit 8.2.2
9. Control of the non-conformance function 8.3
10. Corrective actions 8.5.2
11. Preventive actions 8.5.3

FIDIC Guide to Practice – The business of a professional services firm 212

 Table 12.2: Project Integrity Record Project File recommended procedures
Project description
Record of disclosures of the BIMS to the client
Internal auditors record of review’s of project integrity compliance
Integrity compliance record of processes
4.1. Marketting of consulting services
Technical and financial proposals
Communication with the client
Contract terms
Project Manager’s signed, written assertion specifying supporting evidence that the project
marketing and contracting complied with integrity principles
Project subcontracting and execution
Time schedule and activity programme
Progress reports
Subcontract documents and acceptance of Integrity Policy
Communications with the client and subcontractors
Project time sheets and cost accounts including subcontracts
Agreements justifying the modification of contracts
Signed, written assertion of the Project manager specifying evidence that the subcontracting
and project execution complied with the Integrity Principles
4.2. Project delivery of services and fee collection
Final report and supporting elements
Project manager’s checklist of deliverables
Client acceptance of contract completion
Second-party acknowledgement of compliance with Integrity Priinciples
Invoice documentation and statistics for on-time collection
Benchmark of collection items versus usual collection items for each type of client
Project Manager’s signed, written assertion with supporting evidence of integrity
compliance during the delivery and collection process

Document control
The ISO 9001:200 Standard specifically requires documented procedures of the control of
documents and records (Sub-clause 4.2.3). Control of documents means having a pre-planned
specification for document identification, preparation, review, approval, distribution, availability, storage
and change. Documents covered by this procedure include:
- Records covered by this procedure including the Project Integrity Record File plus other
records required by the Standard.
- Records demonstrating the integrity of each process.
- Records associated with the project (e.g., proposal, contract document, progress reports,
deliverables).
- Records demonstrating the operation of the BIMS (e.g., management review report, audit
results, non-conformance report, integrity competence of staff).
External documents such as standards, protocols and other relevant regulations need to be
identified, and their distribution controlled. A master list of documents is required so that current and
superseded documents can be clearly and easily identified, and so that the issue of documents can be
controlled and traced. The master list should be constantly updated, and should include a record of
changes. The control of records entails demonstrating conformance with the standard, and with the
specified integrity. Important records should be kept in a secure place, and protected from physical
damage and unauthorized access.

FIDIC Guide to Practice – The business of a professional services firm 213

 12.6. Implementation
12.6.1. Start-up of BIMS operation
Implementation should be carefully planned once the design of the BIMS system has been
approved. The consulting firm may choose to introduce Project Integrity Record Files for all ongoing
projects that would be designated as Critical Projects, or only for those contracted after the date the BIMS
was initiated. Moreover, a large firm might select a pilot implementation phase, starting with the
headquarters or a regional office and then gradually enlarging coverage to the remainder of the firm.
The new Project Integrity Record Files are prepared by their Project Managers, according to the
procedures established in the BIMS Manual. The new files will require careful review and revision if
necessary, to ensure that the required level of detail is achieved and standard forms are followed. As
managers become familiar with BIMS requirements, less intensive review of the files will be necessary.
12.6.2. Internal Audit
At specified intervals, perhaps monthly at the outset and once every 3 - 6 months when the BIMS
is running smoothly, the Internal Auditor will review the operation of the system, especially completion
of the Project Integrity Record Files, to make sure that all the prescribed procedures are being followed.
The Internal Auditor will need to work through checklists designed to make sure that no
wrongdoing has take place during the various phases of the Critical Projects that are subject to a 100
percent audit under the integrity management program. If steps required by the procedure are missing, or
if the Internal Auditor detects an incident that is thought to merit additional action, the Internal Auditor
will generate a record of non-conformance, possibly together with a recommendation for the corrective
action that will have to take place.
The internal, or first-party, audit is conducted by a certified member of the staff or by a fully
qualified expert who is retained for the purpose. The audit should comprise the following phases:
- Planning: An audit plan and checklist of topics to be reviewed is prepared.
- Conducting: The auditor reviews the results and prepares a report.
- Reporting: The auditor reports the audit’s findings to appropriate members of the firm’s
management.
- Follow-up and close-out of the Audit Results: Feedback from the Project Manager
regarding action taken.
12.6.3. Management review procedure
Internal monitoring requires a periodic management review. This will assure that the BIMS
remains relevant, adequate and effective. Management should seek an analysis of results derived from
internal quality audits. It should act on these reviews, and records of the reviews should be maintained. A
direct outcome of the management review procedure should be a continuous improvement of the BIMS in
the light of the recommendations based on the internal and external audits.
12.6.4. Modification and continuous improvement
Special attention should be given during management reviews to the improvement of the BIMS,
including consideration of recommendations made by staff. Changes to be adopted should be decided as
part of the management review, thus proving that there is continuous improvement of the system.
Continuous improvement takes into account recommendations made by third parties, including external
auditors when they perform the auditing that is prescribed in order to maintain certification of the BIMS.
Actions should be considered to:
- Modify the procedures
- Expedite the procedures
- Simplify the procedures
- Computerize the system that manages manuals
- Widen the scope of the BIMS by including additional functions.
FIDIC Guide to Practice – The business of a professional services firm 214
 12.7. Training
12.7.1. Staff awareness training
An awareness training programme for staff must be carried out before implementation of the
BIMS. The firm needs to ensure that staff understand how they participate in, and contribute to, the
process of achieving the integrity objectives. All staff members will maintain a record confirming that
they have undertaken awareness training. Records of training courses, content and attendance will be kept
by the BIMS Officer.
Training must cover at least the following components of the system:
- Senior management’s declaration of integrity.
- Knowledge of the firm’s Code of Conduct, with distribution of the document to staff and
maintenance of signed records that each staff member received a copy.
- The need for new employees to acknowledge receipt of their copy of the Code of Conduct.
- Explanation of the reasons for the firm’s integrity policy.
- A general description of the BIMS procedures and their function.
- Procedures for notifying possible violations of integrity principles and procedures.
12.7.3. Training of key operating personnel
The competence and value of staff in a consulting firm have a direct bearing on the integrity and
honesty engaged in the services provided. All activities of the firm can affect integrity - they should be
performed by staff who have the necessary training and knowledge, and who can be relied upon to make
sound judgements in matters concerning integrity. Training of key operating personnel in the
requirements of the BIMS as it applies to them is important to ensure that the BIMS functions effectively,
especially through properly prepared Project Integrity Record Files.
Compliance with requirements to demonstrate adequate training of key operating personnel can
be demonstrated through:
- The job descriptions of Project Managers (responsible for the Project Integrity Record Files)
that specify the required skills based on a knowledge of the firm’s Integrity Policy and
system procedures.
- The staff records of Project Managers that include their training and experience with respect
to the work of maintaining the Project Integrity Record Files and of following the Integrity
Management procedures.
- Training programs that take into account the specific needs for performing assigned tasks, as
well as general training in the integrity management system.
- Integrity Management training programs with a similar level of content and evaluation as
those used to train Project Managers.
- The training of Project Leaders and senior management to ensure that everyone involved
understands and properly complies with the Integrity Policy and operates the Integrity
Management procedures in all of the processes.
12.7.3. Training of the BIMS Officer and Internal Auditor
The Internal Auditor, who must be certified, can be an employee of the firm. Alternatively, the
internal audit function can be out-sourced to a quality/integrity management consultant. The auditor will
have to be trained in FIDIC’s BIMS protocol. The training course could be organised as a service offered
by the FIDIC Member Association in a particular country through a train-the-trainers programme. A
similar approach could be followed to train the BIMS Officer who is responsible for filing all of the
BIMS documents and records, and for supervising compliance with all of the procedures required by the
ISO standard.

FIDIC Guide to Practice – The business of a professional services firm 215

 12.8. External review and certification
12.8.1. Selection of the external auditor
External or third-party certification refers to an outside body reviewing for the consulting firm
that its specified BIMS is in place, and acting to prevent corrupt practices in the first instance, and to
expose and sanction them whenever they occur. ISO certification has come to be widely accepted since
the mid-1980’s, and many countries and consulting industry clients are committed to it. Even for integrity
conceived as a component of providing quality service, the ISO certification represents an international
standard consistently applied and verifiable by an accredited third party.
When considering BIMS certification, the first step is to seek a reliable certification/registration
body, hopefully itself already BIMS certified, to find out what is offered, what it entails and the likely
costs of certification and its maintenance. Once the certification organization has been selected and a
formal application has been filed, the organization will review the Integrity Manual and the Procedures
Manual in a “pre-audit”, to assess how well the consulting firm’s manuals describe what should happen
against what the standard prescribes. If deficiencies are detected, the certifying organization will indicate
them for the consulting firm to amend manuals or to develop additional procedures as needed.
It is essential for the BIMS to have been implemented and in full operation for a few months in
the consulting firm before conducting an external audit. Several months of records demonstrating the
operation of the Integrity Management System will help to demonstrate the functionality of the
implemented system.
12.8.2. Full BIMS audit
For a full review, the External Auditor will check that all non-conformances found in the pre-
audit have been addressed, and will examine in detail the manuals, documents and records as well as
other objective evidence of compliance with the standard. If no inconsistencies are found, the auditor may
issue a ISO 9001:2000 Quality Management Certificate with the scope of “Business Integrity
Management in Consulting Projects”.
Once certification is granted, the certification organization will carry out compliance audits of the
system over the period for which the certification is valid. These audits are not as comprehensive, in that
the full system is not necessarily assessed at each audit. If non-conformances are found during a
compliance audit, and they are not corrected within a specified time, certification may be withdrawn.
Minor non-conformances may require correction by the time of the next compliance audit.
12.8.3. ISO Standards
An ISO standard on business integrity did not exist at the time of publication of this manual
(2003). A new standard would have to be developed and approved to cover the assessment of a business
integrity management system, and the subsequent issuing of a certificate to confirm that the application is
in conformance with the standard’s requirements. In the meantime, FIDIC has formally requested the
International Standards Organization through its Technical Committee 176 responsible for maintaining
the ISO 9001 standard to consider the following:
Give business integrity management its proper status as a feature of best practice that facilitates
the harmonization of world trade and improvements in quality;
- Recognize the existence of FIDIC Guidelines for Business Integrity Management in the
consulting industry published by FIDIC in 2001, and that they may be used as a qualified
reference document in relation to the ISO 9000 family of quality management standards;
- Identify business integrity management as an integral part of the processes used in providing
consulting services, so that it is compatible with the process-oriented concepts of ISO
9001:2000; and
- Recognize FIDIC for its development of the FIDIC Guidelines for Business Integrity
Management in the consulting industry, should the ISO Technical Committee 176 consider it
in its interest to pursue the document as a suitable basis for a new international standard on
business integrity.
FIDIC Guide to Practice – The business of a professional services firm 216
 ISO has a provision for the standardisation of quality management in specific sectors at the
request of the interested sector, and with the support of ISO’s Technical Management Board. This is the
basis for a FIDIC approach to ISO to publish a complement to ISO 9001 with a specific field of
application, the outcome being an ISO/FIDIC standard application to integrity assurance in the consulting
industry. The request is in line with ISO’s Guideline 72, which calls for avoiding the proliferation of
management standards and the admittance of those harmonized with the ISO 9001 standard, as is the case
for FIDIC’s BIMS protocol. It is anticipated that the request will be reviewed in depth by ISO’s Technical
Management Board. Once the BIMS protocol is accepted as part of the standard, the ISO certification of
consulting firms will be in “integrity management”.
12.8.4. A short term certification strategy
Consulting firms participating in a BIMS pilot programme set up by FIDIC for its member firms
have followed an accepted strategy for certification, pending official recognition of the BIMS protocol.
Since integrity relates directly to quality, the strategy calls for implementing BIMS in accordance with the
ISO standard on Quality Management, and duly certifying the consulting firm in quality management
with the scope of “Business Integrity in Consulting Projects”. The first firm to obtain an ISO 9001:2000
quality management certificate within this scope belonged to FIDIC’s Member Association in Mexico.
Other consulting firms from Mexico, Turkey and the Nordic countries are following a similar route,
pending the ISO/IEC TC-176 committee’s ruling on the BIMS protocol.

FIDIC Guide to Practice – The business of a professional services firm 217

Appendix 12A1 - Model Code of Conduct for consulting firms
Social responsibility
1. The firm accepts continuing responsibility for its consulting services before its clients
and Society.
2. The firm will permanently contribute to the benefit of its clients and Society, through
sustained personnel training and technology development aimed at improving
productivity.
3. The firm will include sustainability as a permanent goal in every project.

Quality of service
1. The firm will only undertake project assignments in its areas of expertise, where it has
the capability to deliver efficient and effective service to its clients.
2. The firm is committed to providing high quality services to clients. The firm will focus
on quality management as a working methodology, and on continuous improvement as a
means to improve the quality of service.
3. The firm is committed to the continuing improvement of its knowledge base, abilities and
tools in its area of expertise. The firm will focus on technology management as a working
methodology, and will extend to its clients the benefits of its professional achievements.

Objectivity of the firm

1. The firm will act with loyalty to its clients, and maintain the confidentiality of any
information from the client that is obtained in the process of performing its services. The
firm will also keep confidential the documents and reports prepared for a client.
2. The firm will avoid conflicts of interest, and will inform a client beforehand of any
potential conflict of interest that could emerge during the execution of consulting
services.
3. The firm will only offer its services under contracting terms that do not interfere with its
independence, integrity and objectivity.
4. The firm will not accept any remuneration that could encourage the firm to offer a biased
opinion.

Corporate integrity
1. The firm will only solicit consulting work and participate in private or public competitive
bidding under the highest standards of corporate ethics and competitive practices, and
with total integrity in its transactions.
2. The firm will act at all times for the benefit of clients, and will carry out services with
professional integrity, while not jeopardising the interests of society.
3. The promotional activity of the firm and its services will uphold the dignity and
reputation of the industry. Brochures and other formal documents describing resources,
experience, work and reputation will reflect the firm’s actual circumstances in a truthful
manner.
4. The firm will manage with integrity its internal and external affairs. The firm will focus
on business integrity Management as a working methodology, consistent with the dignity
of the knowledge-based consulting industry.

Competition
1. The firm favours Quality Based Selection for the contracting of its services.

FIDIC Guide to Practice – The business of a professional services firm 218

 2. If solicited to review the work performed by another consultant, the firm will act in
accordance with its business integrity and objectivity policies.
3. The firm will not endorse compensation or contribution arrangements designed to
influence or secure consulting work, nor seek commissions from suppliers of equipment
and services recommended to the client as part of the firm’s consulting services.
4. The firm will not take part in activities that could damage the reputation or business of
others.

FIDIC Guide to Practice – The business of a professional services firm 219

Appendix 12B - Integrity checklist

The following checklist is adapted from FIDIC’s checklist for quality management. It illustrates
the various elements that are necessary for the design and implementation of a business integrity
management system (BIMS).
Consulting firms may wish to initially focus their efforts in specific areas, appropriate to their
complexity, operational methods and other local factors. Eventually, the business integrity Management
culture will require the system to include all relevant aspects of the firm’s operations.
This checklist can be used by the Chief Executive Officer (CEO) to conduct a preliminary audit
of the firm’s integrity practices, to determine whether the introduction of a formal BIMS needs to be
considered, and if so, to indicate the areas on which to concentrate during the initial phases.
1 Business integrity management system
How do the firm’s vision, mission statement and policies address business integrity?
Are these values and principles reinforced and updated?
Is there a current business integrity Manual explaining who does what, when and where?
Does the business integrity manual include standard operating procedures for assuring and
monitoring integrity in:
- Marketing
- Design Services
- Procurement
- Customer Relationships
2 Management Responsibility
Is the CEO committed to ensuring that business integrity guidelines are identified?
Do senior executives provide effective leadership and direction in implementing and maintaining
the firm’s business integrity policy?
Is there a written policy statement on business integrity?
Is the business integrity policy clearly defined, implemented and maintained?
Are all employees aware of the business integrity policy?
Are ethical behaviour guidelines established for each employee assignment?
3 Organizational responsibility and authority
Are the responsibilities, authorities and interrelationships of all who manage, perform and verify
work clearly defined in business integrity matters?
Is there a person or team with responsibility to identify and to take actions on business integrity
problems?
Is there a person or team with authority to simplify or improve business integrity procedures?
Is there a clearly defined way to verify the implementation and results of the proposed
simplification or improvement procedures?

Verification of resources and personnel

Are verification requirements identified?
Do personnel have adequate training and resources to verify business integrity activities?
Do verification activities include:
- Review at designated benchmarks?

FIDIC Guide to Practice – The business of a professional services firm 220

 - Checking documentation of Project Integrity Record Files?
- Audits of the integrity system processes?

Business integrity management staff

Has a firm Representative been appointed to be responsible for checking the business integrity
Management System?
Does the firm Representative report directly to senior management, or serve as part of the senior
management team?

Control documents
Are there documented procedures for controlling all the records and data required for the BIMS?
Are all documents required of the BIMS reviewed and approved by authorized personnel prior to
issue?
Are current copies of appropriate documents available at all locations where operations require
their use?
Is there a master control list that identifies the current version of the documents?

Business Integrity Records

Are there documented procedures for the identification, collection, indexing, filing, storage,
maintenance, and storage of business integrity records?
Are business integrity records being generated and maintained?
Are business integrity records being generated and maintained?
Have retention times of integrity records been defined and recorded?

Management Review
Is the BIMS periodically reviewed to ensure its suitability, adequacy and effectiveness?
Do these reviews include analysis of results of internal business integrity audits?
Does management act on these reviews?
Are records of these reviews kept and maintained?
4 Resource Management

Employees
Do employees whose activities affect business integrity have appropriate education, training and
experience of the assigned tasks?
Are appropriate training records maintained?
Does each employee related to the BIMS know and understand what is expected in his or her job?

Accounting and financial management

Does the firm have project-specific accounting information?
Does the firm share accounting information with its departments and project managers?
Is accurate accounting information in the form of profit and loss statements made available within
days of closing a (monthly) accounting cycle?
Does the firm submit its accounts and operations to an independent outside financial audit at least
once a year?
5 Service realisation
Have the consulting services processes that directly affect business integrity been identified?

FIDIC Guide to Practice – The business of a professional services firm 221

 Have the primary process characteristics that affect business integrity been identified?
Are there document checklists for the integrity of these procedures, and are they used to ensure
conformance to requirements?
Are procedures for ensuring business integrity behaviour in each of the primary processes been
designed and implemented?

Purchasing
Are subcontractors and suppliers evaluated and selected on the basis of their ability to meet
contract requirements, including business integrity?
Is the result of this evaluation of subcontractors and suppliers documented?
6 Monitoring

Client satisfaction
Is there an effective and ongoing feedback system of business integrity verification by clients?
Are adequate client verification records maintained by the firm?

Internal business integrity verification

Has a documented procedure been implemented for conducting internal business integrity audits?
Are audit procedures and follow-up actions defined and documented?
Are audit results brought to the attention of the appropriate management so that corrective action
may be taken?
Are specific sanctions specified and corrective action taken on corrupt behaviour cases found in
the audits?

FIDIC Guide to Practice – The business of a professional services firm 222

Appendix 12C - Sample auditor’s integrity review form

A. MARKETING AND CONTRACTING PROCESS

1. Disclosure to the client of Code of Conduct Yes No
Evidence of formal delivery to the client of company brochures stating the existence
of the firm’s Code of Conduct and BIMS
Code of Conduct and BIMS disclosure as part of the project proposal
2. Management of potential conflict of interest
Evidence of having considered a potential conflict of interest (attach Conflict of
Interest Checklist if appropriate)
Evidence of follow-up management procedures in the case of a potential conflict
3. Integrity management during the bidding process
Definition within the firm of the project as a Critical Project
Proposal reflects the actual experience of the firm
Resumes of staff reflect their actual experience
Evidence that the firm was not involved in the short-list selection process
Evidence that the firm did not collude with other participants
Project Manager’s signed, written assertion, and evidence of the firm’s integrity
during the process (for Critical Projects)
4. Relations with representatives and/or sub-consultants
Completed due diligence (Form XX) and red flags (Form YY) forms (for projects
executed outside the firm’s home country)
5. Conditions of Contract
Conditions of Contract reflect the scope offered in the original proposal

Evidence of justifiable reasons in the case of changes to the Conditions of Contract

Evidence of actions taken in the case of irregular practices initiated by the potential
client
Evidence of actions taken in the case of suspected wrongdoing by associates or
subcontractors
Project Manager’s signed, written assertion, and evidence of the firm’s integrity
during the process (for Critical Projects)
B. PROJECT EXECUTION PROCESS
6. Adequate work team
Evidence of adequate staffing levels and staff expertise throughout provision of
services to the client
Existence of detailed terms of reference and contracts for associates and
subcontractors

FIDIC Guide to Practice – The business of a professional services firm 223

7. Contract modifications
In case of contract modification (involving, for example, contents, price, schedules),
evidence that adjustments were as indicated and justified
8. Consultant/client integrity relationship during execution
Existence of fair treatment in dealing with contractor selection, contractor
supervision and claims handling
Evidence of there being no attempts of extortion by the client’s employees during
execution
Concrete preventive or corrective measures if extortion is attempted
Project Manager’s signed, written assertion, and evidence of the firm’s integrity
during the process (for Critical Projects)
C PROJECT DELIVERY AND COLLECTION PROCESS
9. Compliance with the Conditions of Contract
Evidence that actual project deliverables fulfill the contract terms
Evidence of on-time delivery of products, and failing this evidence of the formal
acceptance by the client of a time extension
Evidence of acceptance by the client of contract fulfillment
10. Contract collection

Justification in case of an earlier than agreed collection schedule

Evidence of avoidance by the firm in case of extortion attempts during collection

Project Manager’s signed, written assertion, and evidence of firm’s integrity during
process (for Critical Projects)
D. COMPLIANCE WITH INTEGRITY PROCEDURES

11. Compliance with BIMS and Code of Conduct

Operation is in conformance with Code of Conduct and BIMS

Non conformances

12. Observations and recommendations for Senior Management Review:

The Internal Auditor:

BIMS Compliance Officer:

FIDIC Guide to Practice – The business of a professional services firm 224

Appendix 12D - Sample conflict of interest checklist

Yes No Not
Applicable
A ANALYSIS OF POTENTIAL CONFLICTS OF INTEREST
1. Personnel relationships (family, colleagues, etc.)
Employees within the firm or associations resulting in potential client
conflict through family ties or former employee relationships.
2. Consulting assignments
Previous assignment characteristics or recommendations for the same
client conflicting with current assignment
Previous or concurrent assignments for other clients with similar or
competing interests
3. Consulting services – Procurement
Design or procurement services for other assignments conflicting with
procurement of goods and services from related suppliers for current
assignment.
4. Review of the work of others
Potential lack of objectivity
B STEPS TAKEN TO RESOLVE POTENTIAL CONFLICTS OF INTEREST
5. Notification of client (attach copies)
6. Formal internal safeguards (e.g., confidentiality agreements)
(attach copies)

FIDIC Guide to Practice – The business of a professional services firm 225