CPP pre-solicitation meeting record of Q_A.pdf

U.S. International Development Finance Corporation (DFC)

DFC Client Protection Procedures Training & Implementation Pre-Solicitation Meeting on May 16, 2024

Record of Questions and Answers (Q&A)

Number Question Answer 1 Regarding task 4.1.c to benchmark other DFI client protection procedures:

a. What is the scope of this exercise?

b. How many DFIs do you want to benchmark against?

c. Has preliminary research/ consultations already been conducted to identify if there is willingness on the part of other DFIs to share this information and the extent to which they are willing to share?

DFIs are usually open to sharing information on their approaches. The aim is for the contractor to do an initial review of DFIs and hone in on ones that are considering or addressing CPP challenges. We anticipate those would include the International Finance Corporation, European Bank for Reconstruction and Development, European Development Finance Institutions, etc. The goal is to engage those DFIs to understand what, if any, policy, protocols, and/or visions they have for implementing client protection principles into their transaction approval and monitoring processes.

2 Can the key personnel be 1 or 2 people instead of the 3 labor categories listed?

Yes – vendors will be provided the opportunity to propose alternate key personnel.

Record of Q&A

3 Should we plan for monthly trainings? What is the estimated number of people and applicants envisioned for the training?

The priority is training DFC staff, starting with Environmental and Social Staff, and progressing to Investment Officers.

Approximately 30 attendees for a training for the teams that develop clearances and monitor compliance for environmental and social factors. These are the staff who conduct due diligence and monitoring and will need expertise in CPP. We anticipate one training in year one once the updated protocols, process, and tools are ready, and potentially another training in year two if there are major changes, such as improvements to our processes or new tools.

Approximately 100 attendees for training for investment officers, individuals with finance backgrounds who originate transactions. We anticipate one training for this group in year one, and potentially a follow up in year two if there are major changes to processes.

For clients, we are looking for recommendations or tools and materials to further their CPP capabilities; as time permits perhaps trainings would be organized. This is variable depending on needs identified during the benchmarking and assessment process and as feedback is received from DFC employees.

We intend to provide additional details and specifications for the training task in our forthcoming solicitation.

4 Will travel be permitted (e.g., at least for training)?

Yes. However, all training must have a virtual option, too, as DFC has some remote employees and employees that telework frequently.

5 Having an estimate for the timing and extent you are envisioning beyond the first 6 months of the project, plus overall budget information, would be helpful to design a strategy and implementation plan that meets your needs.

DFC has an estimated $180,000 budget for the full performance period. This figure is not a ceiling or floor on quotes; rather, this information is provided as a courtesy to prospective vendors. DFC may select a quote for award with a price below, at, or exceeding this figure, if DFC determines that the quote provides the best value and funds are available.

Work past the first six month will likely include, as necessary: follow-on trainings and updates to the client protection protocols and guidance developed as they are implemented and feedback comes in.

6 A large part of the training focuses on knowledge building which lends itself well to online learning.

However, there’s also an important part of skills development for both DFC staff (how do we convince financial service providers of the benefit of CP requirements) as well as financial service providers (how do I implement DFC’s requirements into practice?). These skills-focused learning goals are best achieved through in-person workshops. Would it be possible to also include a travel budget for in-person learning?

Yes, we intend to permit travel for in-person training.

7 Given that the perspective of DFC staff and financial service providers on CP is quite different, we feel it would be beneficial to develop training materials catered to these different audiences (although based on the same content). Is that also DFC’s expectation?

Yes, we agree that training should be tailored to different audiences.

Within DFC, we would expect training for Environmental and Social Staff to be more of a deep drive into CPPs, protocols, and benchmarking, whereas training for Investment Officers is anticipated to be more of an introductory training.

Moreover, we will be relying upon the contractor’s expertise to help inform the roles and responsibilities for DFC personnel with regards to client protection verification, so the training will need to be tailored in this way to specific audiences. For example: origination teams may be responsible for verification of collateralization, whereas environmental and social teams may have more responsibility for things like grievance mechanisms and client data privacy. Trainings should be focused on these respective areas of responsibility.

8 There is no budget indication, but the total project cost will depend strongly on the number of trainings sessions delivered. Does DFC already have a view on the expected number of sessions? And if not, is it OK for DFC if we budget the training delivery on a unit basis?

We intend to add additional details for the training task in the forthcoming solicitation; see also our response to questions 3 and 7 above. We are open to pricing training on a per unit basis.

9 SAM.gov often requires to reverify physical address of service providers which can lead to them being 'off-line' temporarily due to no cause of the service provider. But I have noticed this has created problems with DFC procurements where the team seeks to verify things like US small business verification requirement while SAM.gov is verifying address in the US - and admin requirement. This has punished service providers on DFC procurements due to no fault of their own. Can you comment on how you can prevent this from happening?

Vendors are encouraged to start the registration renewal process early to work through issues like physical address validation. DFC is limited in the assistance it can provide regarding registration in SAM.gov.

10 Can you also comment on when/why certain business classification requirements are used on solicitations?

In some cases they are present in others they are not. What is the logic?

Generally, an acquisition of supplies or services at the dollar value contemplated for this project is required to be set aside for small business concerns unless the contracting officer determines there is not a reasonable expectation of obtaining offers from two or more responsible small business concerns that are competitive in terms of fair market prices, quality, and delivery. FAR 19.502-2(a). This is commonly referred to as the “rule of two.”

Notably, small business set aside requirements generally do not apply to the use of the GSA federal supply schedule program, although the discretionary use of small business set asides is permitted for GSA federal supply schedule orders. FAR 8.405-5(a).

11 Did you say this procurement maximum value is only $180,000?

Our estimated budget is $180,000. Please see our response to question 5 above.

12 Have there be any discussions on coordinating a broader exercise with other DFIs (as other DFIs are also reviewing their CP practices)? Also, benchmarking should take into account an evaluation of the quality/ state of development of existing DFI practices (per a previous comment that many of these are in flux right now)?

This requirement does not include a broader exercise involving other DFIs.

Under this contract, we are curious as to what our fellow DFIs are doing in this space. We’d like the contractor to examine how DFIs are approaching the implementation of client protection practices and to which particular borrowers and clients; the DFI’s methodology and decision matrix for the same; and how DFIs are assessing the relevant levels of client protection risk.

This benchmarking isn’t intended to cover the whole universe of DFIs, as DFIs that do not include client protection as part of their practice can be discarded from the benchmarking exercise. We are more concerned with other DFIs that have started this process and what they are doing. We have some thoughts as to where the contractor should start but we will also be relying upon the contractor’s expertise and network to approach the benchmarking process.

In terms of quality, we are interested in understanding where certain DFIs are maturing in certain aspects of CPP and where others are at an earlier stage of implementation.

Additionally, we often co-invest with other DFIs, so we try to remain consistent in our practices relative to our fellow institutions.

13 Do the E&S staff conduct due diligence?

Yes, due diligence is the responsibility of the environmental and social staff here at DFC, both reviewing projects before the transaction is completed and during the execution of the transaction.

14 Do non-profits count as small businesses?

No, a non-profit, 501(c)(3) entity would not qualify as a small business concern for the purpose of federal government small business preference programs. A business concern must, among other requirements, be “organized for profit” to meet the definition of a small business. 13 CFR § 121.105(a)(1).

Additionally, to be clear, DFC has not, as of the date of the pre-solicitation meeting, decided whether to set aside this requirement for small business concerns.

15 So if using GSA schedule and two or more bidders are qualified doesn't have to be small business set aside? Thanks

That is generally correct – even if the criteria for the “rule of two” (discussed in DFC’s response to question 10 above) would otherwise be met, under the GSA federal supply schedule program the use of small business set asides is discretionary. FAR 8.405-5(a).

16 Would DFC also like environmental assessments covered as part of this project or is the focus primarily on customer protection?

The focus is on customer protection.

17 Are there specific DFIs you want to benchmark? Any preference for bilateral or multilateral? And any desire to benchmark large banks that may have similar concerns?

Some of the specific DFIs that we are keenly interested in include the European Development Finance Institutions (EDFI), FMO (the Dutch development bank), and the International Finance Corporation, as a starting point.

Another part of this conversation is multi-lateral vs. bi-lateral and the different implications for how CPP is addressed within each type of DFI.

Examining large banks with similar concerns could fall within scope as its also important to understand what the market is doing.

Please also see the response to question 1 above.

18 What are the clients that you are considering to apply these CP procedures on? Banks? NBFIs?

Fintechs?

Initially we’re looking to follow the current approach, which is examining client protection risk based on transaction type. For a financial service provider, we examine the level of client protection risks associated with its lending strategy. The clients could be nonbanking financial institutions (NBFIs), banks, microfinance institutions, or even an investment fund.

This is a question where we would like to have some guidance and thought from the contractor based on the benchmarking exercise and DFC’s specific activities.

19 Are the due dates on the deliverable table in the SOW flexible/adjustable? I noticed that the DFI benchmarking review of best practices are due within one month of the kick-off meeting. This is a tight turnaround when coordinating with multiple DFIs during the month of August when most European DFIs are out of office.

Thank you for this feedback; we will consider this in developing our solicitation.

20 Which geographies/countries are these clients located in?

Generally, all over the world. There is a map on the DFC website which shows where DFC operates; this can be accessed at https://www.dfc.gov/what-we-do/our-work#regions.

21 Would you be interested in local training of staff in those regions?

We have a limited number of staff that are based outside of Washington, DC. But this is something we can consider, as staff in-region will be having some of the initial conversations with our partners and clients.

22 Just to clarify the earlier question, a 501(c)(3) is not allowed to apply for this project?

A 501(c)(3) entity would not qualify as a small business concern (please see our response to question 14 above) and would therefore not be eligible to participate in this procurement if this procurement is set aside for small business concerns.

If this procurement is not set aside for small business concerns – what is commonly referred to as an “unrestricted” procurement – then a 501(c)(3) would generally be able to participate in that procurement, as would other entities that do not qualify as small business concerns (assuming the entity meets other requirements unreleased to small business status, like SAM.gov registration).

To be clear, DFC has not, as of the date of the pre-solicitation meeting, decided whether to set aside this requirement for small business concerns.

23 One small precision:

Cerise+SPTF now talks about Client Protection Standards - there are now 8 CPS - that are integral part of the Universal Standards Social & Environmental Performance Management

(USSEPM)

Thank you for this clarification.

24 When will you make a determination about whether it will be a small business set aside?

Whether the procurement is set aside for small business concerns will be announced in the solicitation itself. We anticipate releasing the solicitation on or about June 6, 2024, although this date is subject to change.