77344424Q0143 questions and answers as of 07.10.24 (final).pdf

U.S. International Development Finance Corporation (DFC)

DFC Client Protection Procedures Implementation & Training RFQ no. 77344424Q0143

Questions & Answers as of July 10, 2024

Number Question Answer 1 During the pre-solicitation meeting, a concern was raised regarding deliverable #4 (DFI benchmarking report) and the August holidays in Europe. In the updated schedule, the kick-off meeting date was changed.

However, even if the kick-off happens in July, can we still consider that it will take September and October to complete all of the DFIs interviews/surveying and that the DFI benchmarking report may only come in November?

Please note that DFC now anticipates the award of this contract on or about Friday, September 6, 2024, per the update posted to SAM.gov on June 28, 2024.

With a projected contract award date of July 29, 2024, we do not anticipate the kick-off meeting occurring in July 2024.

The requirement to hold the kickoff meeting “before mid-September” accommodates the potential for contractor staff unavailability during the month of August 2024. Further, due to the anticipated absences of key DFC personnel in early August 2024, the earliest we anticipate holding the kick-off is mid-August 2024. However, the contractor will have until mid-September 2024 to execute the kick-off meeting.

The DFI benchmarking report, deliverable #4, is due approximately two-and-a-half months following deliverable #1, the kick-off meeting, based upon the due dates for intermediate deliverables #2 and #3, which are relative to the delivery of the preceding deliverable. This schedule places the due date for the DFI benchmarking report on or about early November 2024 (if the kick-off were held in mid- August 2024) to early December 2024 (if the kick-off were held in mid-September 2024).

Q&A as of July 10, 2024

2 Is our reading of the text below Task

Area 3 (e.g. “Note: training is not the focus of the work in this contract, but rather the next step, once benchmarking and guidance development is complete, to support the dissemination of lessons learned and procedures developed under Task Areas 1 and 2.”) correct that the budget ceiling of $180,000 covers only Task Areas 1 and 2 but not Task Area 3 and thus our financial proposal should only consider those two tasks. However, we are expected to share in our technical proposal how we would complete Task Area 3 as well. Is this interpretation correct?

That interpretation is not correct. Prospective vendors are expected to quote a price that includes tasks 1, 2, and 3.

Tab (a) of the price template (attachment 2 to the solicitation) includes a column for estimated labor hours to perform task 3.

Prospective vendors are expected to include their estimated level of effort for task 3 here.

Additionally, prospective vendors are expected to include the estimated costs for any materials to perform task 3 in tab (c) of attachment 2, as well as estimated costs for travel to conduct hybrid training (if hybrid training is part of the vendor’s approach to the training requirement) in tab (d).

The referenced language appearing in italics under the task 3 title (section 4.3 in the statement of work, attachment 1 to the solicitation) was merely intended to communicate where the emphasis of this project is expected to be placed.

The $180,000 figure provided in paragraph (j) of the solicitation is inclusive of the full price to perform this requirement, inclusive of tasks 1-3 and both contract line items (CLINs).

3 For the experience paper, we are describing our experience and providing weblinks to external materials. Our submission will be limited to 5 pages. Should we include these links, given they contain additional information beyond the 5-page limit? Or would it be better to exclude the links?

Please limit your experience paper to only the five pages requested. DFC will not review or consider material in excess of these five pages, including weblinks to external material.

Accordingly, we would advise against including weblinks in your submission.

4 Who was the previous incumbent, and how long was the contract?

There is not an incumbent for this work.

5 What areas did they excel in, and what were areas they failed to meet expectations?

Please see our response question #4, above.

6 What are the current issues DFC is facing, in terms of Client Protection Procedures?

DFC is facing the same Client Protection issues as the rest of the industry across all eight Client Protection Standards. More information will be provided to the contractor following award.

7 What has DFC attempted in terms of solving these issues associated with Client Protection Services?

DFC has attempted various due diligence and monitoring approaches. More information will be provided to the contractor following award.

8 Please describe if there are specific types of client protection standards (CPS) that the DFC is looking to incorporate in its investment process, or is the RFQ ask a more general development of CPS?

(Notably the RFQ mentions that in the case study: “selected project need not focus on CPS directly but should be related to environmental and social policies, financial inclusion, or the DFI investment process”)

DFC is looking to incorporate all CERISE+SPTF client protection standards into our investment process.

This question calls out the case study component of the oral presentation in paragraph (h)(7)(i)(A)(1) of the solicitation. The intent of the case study component is for DFC to gain an understanding of the vendor’s experience designing and implementing policies and procedures at a DFI. So as not to be overly restrictive, the case study was not restricted to CPS directly. A vendor’s experience designing and implementing policies and procedures at a DFI will, in DFC’s view, weigh on the probability of that vendor being successful in the performance of this contract, and therefore this experience is part of our evaluation.

The permitted topics for the case study do not change or affect DFC’s requirements as contained in Attachment 1 – Statement of Work.

Further, the second component of the oral presentation contained in paragraph (h)(7)(i)(A)(2) of the solicitation requires the vendor to address its “capabilities and qualifications to implement CPS.”

9 Who does the DFC view are the

Clients in-scope for these standards?

The clients for these standards are the end borrower. For example, if DFC provides a loan to a financial institution, DFC expects the client protection standards are applied by the financial institution with its end borrowers (these may be individual borrowers or micro-, small-, or medium-sized enterprises, etc.).

10 Are there certain types of lending or equity investment (or both) product types or terms that the DFC is looking to define these CPS standards around? What are they?

DFC is looking to apply the client protection standards to all of our financial products. More information on these products can be found here: https://www.dfc.gov/what-we-offer/our-products.

11 Should the CPS focus on fair/reasonable valuation and pricing also?

Yes.

12 Are there existing external CPS standards (especially on certain ESG topics) that DFC would like to align to?

DFC would like to align to the CERISE+SPTF client protection standards. More info can be found here: https://cerise-sptf.org/about-client-protection/.

13 Does the DFC have any current standards CPS standards in-place?

And can it share a timeline/current plan for applying CPS?

DFC currently looks to the CERISE+SPTF client protection standards as a framework. The role of the selected contractor will be to support DFC’s work in putting in place these standards through the development of standard operating procedures and the training on those procedures. The timeline for this aligns with the Deliverables timeline found in Attachment 1 – Statement of Work.

14 In task 2 in the statement of work, is

DFC expecting that (i) the vendor develops written standard operating procedures, or (ii) that the vendor provides written guidance on what SOP to improve/update? In the Attachment 2 for price, Task 2 is named "Guidance on DFC Systems Development", which raised the doubt. It is not the same level of effort to provide guidance and recommend systems development, and to actually write/update internal procedures and tools.

The vendor will be required to develop standard operating procedures (SOPs) and other guidance documentation for DFC (i.e., actually write the SOPs and documentation), not provide written guidance on what SOPs should be improved or updated. The title for task 2 in the price template (Attachment 2) has been revised to match the title for this task in the statement of work. Please see Attachment 2 - Price template (amended 07.10.24).

15 In task 3 (Statement of Work

§4.3.b.iii) is the limitation of trainings to half a day fixed and final? In our experience, the stated objective of "The training shall include detailed information on the Cerise+SPTF client protection auditing process and interpretation of data submitted in the Cerise+SPTF Client Protection Self- Assessment" cannot be fulfilled in half a day, especially if we want to incorporate interactive activities in between the deep-dive into the concepts. Can we suggest a longer training length? With different formats, such as self-paced e-learning, or instructor-led e-learning, or several days of in-person training, or individual coaching on real case investments, etc.?

Training is not the focus of this Statement of Work, but rather a method to ensure the dissemination and understanding of the SOPs developed under Task Area 2 combined with fundamental CPS principles. For the Investment Officers, it is important that the training is limited to a half day, to ensure as many Investment Officers as possible complete the training (or view the recording). Alternate formats such as e-learning and self-paced could be appropriate for such an audience. If a recorded training is not available from a live training (e.g. self-paced), DFC must still be able to provide a copy or access to the training developed after the performance period ends (e.g. to new staff, as refreshers, etc.).

For DFC’s Social and Environmental (E&S) staff, we are open to a longer training. However, we anticipate it would be difficult to have all E&S staff available for a day or multi-day training, so if a longer training is proposed, the training delivery format must address that limitation.

Regarding coaching on real case investments, that could be a method of delivery for Task Area 3a.

As both audiences will receive two trainings, one in year 1 and one in year 2, there is an opportunity to progressively build the material and dive into topics not covered in the first year during the second year.

Please see Attachment 1 - Statement of work (amended 07.10.24).

16 In task 3 (Statement of Work §4.3.b) why should the DFC investment officers be trained differently and separately from the Social and Environmental staff? How different should the trainings be? Can we suggest to rather differentiate per roles and responsibilities in the diligence and monitoring, and propose an in-depth training on CP assessment skills for the most involved and an intro training for those less involved?

DFC’s Social and Environmental staff diligence and monitor for factors such as client protection, while Investment Officers typically focus their diligence on more financially focused issues. In terms of CPS, Social and Environmental staff will be most involved while Investment Officers, who may still have CPS responsibilities defined in the SOPs, will still likely be less involved. It would be appropriate to provide a more introductory training for Investment Officers to CPS while providing a more in-depth training to DFC’s Environmental and Social staff.

17 Would you agree that Statement of Work §4.3.c could fit under task 2?

Task Area 2 should be completed first to ensure that the client guidance material (Task Area 3c) accurately prepares clients for what DFC will be analyzing when following the SOPs developed under Task Area 2.

18 Is the DFC’s intent to adopt the Cerise+SPTF standards, entirely as published, as policy?

At this stage, DFC’s intent is to develop client protection SOPs benchmarked against our peer institutions and leveraging the Cerise+SPTF standards.

19 How many DFC subject matter professionals does the DFC expect would need to be interviewed to understand the underwriting/due diligence, environmental and social risk assessment, monitoring, credit risk processes? And how many executive-level interviews does the DFC expect would need to be conducted?

A minimum of one Environmental and Social staff and one Investment Officer should be interviewed. The exact number will vary depending on the selected vendor’s familiarity with development finance institution processes, availability of staff, any follow up interviews needed as new information arises, etc. DFC only expects executive-level interviews with 1-2 individuals.

20 Could the DFC please provide an example scope of a normal SOP, expected page count, and document structure for the SOPs that the DFC would expect?

DFC may provide an SOP example to the selected vendor, but a normal scope will have practical, detailed instructions on items that need to be accomplished in operational order.

However, the page count will depend on what needs to be documented in the SOP. Structure would utilize standard Word functions and can be agreed upon between DFC and the selected vendor upon award.

21 In terms of the number of SOPs or topic areas, organization, and level of detail for the SOPs, could the DFC describe its expectation of the SOP documents required under Task Area 2?

DFC expects one SOP; it may be sectioned based on roles and responsibilities, position type, stage of a transaction, etc. Topic areas will be determined based on the benchmarking against other DFIs and the Client Protection Standards. Organization of the SOPs will be agreed on between DFC and the selected vendor as part of the SOP drafting process.

Level of detail should be sufficient such that if an individual that is familiar with DFC’s processes, but not with CPS, is provided DFC’s CPS SOPs, that individual should be able to successfully implement the SOPs.

22 What types of other guidance documentation as described under Task Area 2 is expected?

This includes any documentation that will make the SOPs easier to understand. This could include one-pagers on the SOPs and/or documentation that will be used to support the training and dissemination of the SOPs to DFC staff under Task Area 3.

23 In terms of guidance on enhancing systems and protocols described under Task Area 2, what are the systems that the RFQ is referring to?

Are the enhancements meant to be system requirements or manual processes?

The systems and protocols to be enhanced will be DFC’s existing client protection related processes. The enhancements are effectively the SOPs. There is no systems work in terms of software development.

24 The Client Protection Standards are comprehensive and provide specific guidance for broader operations outside the actual investment risk and underwriting processes. Is the scope of this RFQ limited to risk and investment underwriting only?

The scope is based on where DFC has control and oversight related to CPS. This is encompassed throughout the investment process (due diligence, monitoring, etc.).

25 Is US DFC also looking for implementation recommendations and training for departments and functions that fall outside the typical investment and underwriting process, such as MDB/DFI implementation advisory support for borrowers, IT security, and HR policy?

This falls outside the scope of this solicitation.

26 What are the external written guidance materials to support clients envisioned and expected by the DFC under Task 3 (4.3c)?

The external written guidance material envisioned are simple 1-2 pagers that can be shared with DFC’s clients who are new to CPS and DFC’s CPS expectations. The external guidance material should answer standard CPS FAQs and link to publicly available resources to help DFC clients develop and/or enhance their own client protection processes to align with DFC’s requirements.

27 On the question of fair valuation or responsible pricing, does the US DFC seek broad qualitative policy guidelines or should we assume we will be making specific numerical or metric recommendations as they relate to debt (interest rates charged), equity (cash-on-cash multiples, internal rates on return), or insurance (rates charged)?

This will be informed by the DFI benchmarking process. However, given DFC operates globally and numerical recommendations may vary drastically depending on the financial situation of different countries, we anticipate qualitative policy guidelines unless quantitative recommendations can be developed that are usually globally applicable.