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Ethics in Purchasing

Introduction

University staff involved in the purchasing function should ensure that they conduct all business not only efficiently but in a fair and reasonable manner whilst ensuring openness and integrity at all times.

To achieve this aim, staff should be aware of several guiding principles which under-pin good purchasing practice. Observing these principles of good conduct and behaving in an honourable and transparent manner is important not only to ensure trust and respect between all parties but also because University purchasing involves the spending of public funds which is subject to particular scrutiny.

Staff should also realise that being aware of and following these principles can reduce the threat of fraud, theft and corruption being levelled at themselves, their department and consequently at the University. The rules outlined below can vary in application depending on particular circumstances, however, in most cases common sense applies.

This guide sets out some of the basic principles and practices which should be followed and/or taken into consideration.

Management Responsibility

Managers should ensure that staff involved in the purchasing function are aware of the principles outlined in the Guide and understand the need for ethical behaviour.

Disclosure of Interest

There should be no conflict of interest between the official duties and private interests of those University staff involved in purchasing and their conduct should not foster any suspicion of this.

Any member of staff involved in the purchase of goods or services should disclose any form of personal interest which arises, for example, where a relative or friend is involved in the quotation or tender process on the supplier's side or where a relative or friend owns the business or can provide the service which the department wishes to procure. (Please refer to the University's Register of Interests Policy .)

It must be remembered that impartiality and fairness must be evident at all times. Hence, an interest in any element of a proposed purchase should be made known to both the member of staff's line manager and to the Head of Purchasing. Both the line manager and Head of Purchasing will give consideration to the appropriateness of using the supplier suggested and, if deemed appropriate, the purchase will proceed in this open and transparent manner. Where there is concern with the use of the suggested supplier, the staff member will be advised accordingly.

The purchase requisition (used to generate either a purchase order or a purchase card transaction) contains a declaration placed under the authorised signatory's signature "I have no related interest in this requisition as outlined in the University's Regulations, Guidelines and Procedures for the Procurement of Goods and Services". This means that if a person who is an authorised signatory has a related interest in the firm supplying the goods/services, then that person should not sign the requisition.

Gifts and Hospitality

Please refer to the University's Policy on the Acceptance of Gifts, Gratuities and Hospitality.

Fair Dealing

Dealings with suppliers must be honest, fair and even-handed at all times.

To foster such an atmosphere with suppliers and to show that the University is an impartial and ethical manager of the public funds in its charge, staff should not mislead or unfairly pressurise suppliers.

Confidentiality of Information

Any information provided by tenderers should be regarded and treated as confidential.

Staff should note that in order to maintain integrity, information received in the course of a purchasing exercise should be treated as confidential. Details of the tender documentation and contracts including price etc should not be divulged to competitors or others, and all paperwork regarding the exercise should be kept secure.

Systems and Procedures

Good purchasing practices should be promoted and augmented by the appropriate systems and procedures within every unit of the University.

Staff should be aware of the importance of written records. These will demonstrate that proper ethical standards have been observed and are used both as an audit trail and a record of reasons for making a particular procurement decision. Such written records should include adherence to the proper procedures laid down for obtaining the proper number of sealed quotations or tenders, the raising and placing of orders, receipt of goods/services and the authorisation of invoices for payment.

The House of Commons Public Accounts Committee Report of 9 March 1994 on University Purchasing in England makes specific reference in recommendation 5 to "... the fundamental requirement that an invoice should be authorised for payment by a different person to that raising the related purchase order." This requirement should be followed at all times regardless of the source of funds for the purchase (research, general or otherwise).

Summary

Staff should be aware of good practice and the principles outlined above but as can be seen, detailed rules cannot be drawn up to cover every situation. Clarification on any of the general points discussed, or guidance on specific issues, should be sought from the member of staff's line manager or from the Purchasing Office.

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