In order to fulfill its mandate and achieve its vision of empowered lives and resilient nations, UNDP must procure a significant volume of goods and services. As a public organization entrusted with donor funds and committed to supporting developing economies, UNDP abides by the following principles:
Best Value for Money, which consists of the selection of the offer that best meets the end-users’ needs and that presents the best return on investment. Best Value for Money is the result of several factors, including quality, experience, the vendor’s reputation, life-cycle costs and benefits, and parameters that measure how well the good or service allows the organization to meet its social, environmental or other strategic objectives.
Fairness, Integrity and Transparency, which ensures that competitive processes are fair, open, and rules-based. All potential vendors should be treated equally, and the process should feature clear evaluation criteria, unambiguous solicitation instructions, realistic requirements, and rules and procedures that are easy to understand.
Effective International Competition, understood as giving all potential vendors timely and adequate information on UNDP requirements, as well as equal opportunity to participate in procurement actions, and restricting them only when it is absolutely necessary to achieve UNDP development goals.
In the best interest of UNDP, which means that any business transactions must conform to the mandates and principles of UNDP and the United Nations.
UNDP has to strictly observe its financial rules and regulations. While this may sometimes lengthen the procurement process, UNDP delegates a significant amount of authority to its Country Offices, has introduced more flexible methods for low-value/low-risk purchasing, and approves purchase orders electronically, all of which save time and money for the organization and its vendors.
How Does UNDP Do Business
UNDP procures goods and services by soliciting bids through a competitive process. The following methods are used for the procurement of goods and services:
Request for Quotation (RFQ)
This is the most flexible and the least formal method that is used for procuring goods, services and/or works. RFQs call for a written quotation.
RFQ applies to contracts exceeding US$2,500 but less than US$100,000
Invitation to Bid (ITB)
An ITB is normally used when an entity is not required to propose technical approaches to a project activity, or to offer management or supervision of an activity. ITBs are used when an entity has to provide its cost requirements to meet precise specifications sought from UNDP. This is normally the case when UNDP buys goods. It may also apply to work contracts and services that can be expressed quantitatively and qualitatively.
ITB applies to contracts exceeding US$100,000.
Request for Proposal (RFP)
RFP is used when the inputs and/or outputs cannot be quantitatively and qualitatively expressed at the time the invitation is made, for example, consulting or similar services. An RFP may also be used for the purchase of complex goods when one is not sure of the functional specifications and wishes to seek proposals.
RFP applies to contracts exceeding US$100,000.00.
UNDP procurement guidelines categorically prohibit UNDP staff members from accepting any gifts and favours from vendors and partners. UNDP staff will not accept any gift, honour, decoration, remuneration, favour or economic benefit from any source external to their organisation.
This also includes governments, commercial firms and other entities. This prohibition on receiving gifts and favours extends beyond UNDP policy and is also embodied and institutionalised in the Code of Conduct established by the International Civil Service Commission of the United Nations.