Detailed Information :

India

Year of Establishment: 2005

Project Phase: Implementation (Long-term Initiative)

Participants: Oil and Natural Gas Corporation Ltd. (ONGC), bidding companies, and external monitor.

Scope:

• ONGC spends $ 5 billion/year on major contracts. The Integrity Pact will strengthen and improve the performance and image of ONGC.

Key Facts:

Description

• The Oil and Natural Gas Corporation Ltd. (ONGC) was the first organization in India to adopt the Integrity Pact concept. It applies integrity pacts to all major procurement contracts with bidding companies since July 2005.
• The Integrity Pact was developed in cooperation with Transparency International India (MoU with TI-India was officially signed in 2006).
• The goal of the Integrity Pact is to reduce any (and almost ensure no) chances of corrupt practices during procurement through a binding agreement between the agency and the bidders for specific contracts.
• As of March 2007, over 500 vendors had signed the Integrity pact and all complaints made to the IEMs (Independent Monitors) were satisfactorily and expeditiously resolved.

Key Learning:

• The size of ONGC and the vulnerability of the extractive industry sector, combined with the wide scope (all contracts) and the involvement of civil society makes this initiative significant.
• The use of independent monitors and government involvement can add leverage to a collective action effort.

Mechanisms:

• The Integrity Pact starts when a bidder submits an "Expression of Interest" and ends after the execution of the contract after all payments have been made.
• Integrity pact signed by all bidders in major procurement contracts.
• Independent external monitors are chosen by the Indian government (Central Vigilance Commissioner).

Benefits:

• Improving ONGC’s image and reputation as an ethical organization
• Giving confidence to its vendors that their bids would be considered and they not required to pay any bribes
• Speeding up tendering and procurement processes
• Reducing substantially political and administrative interference in procurement
• Checking frivolous lawsuits and complaints from vendors who lost the contract

Links:

• ONGC India
• TI India
• Integrity Pact template between ONGC India and bidder

Source:

• ONGC
• Transparency International India