Attributed to Callaghan Innovation Chief Executive Stefan Korn:
Callaghan Innovation acknowledges the report of the Auditor General into how we evaluated providers for the Founder and Startup Support Programme in 2022 and we thank the Office of the Auditor General for their efforts in carrying out the inquiry.
We accept the process for vetting suppliers did not meet the high standards expected of a public sector organisation.
We have learnt lessons from this experience and have made several changes to the way we evaluate and select suppliers.
A thriving startup ecosystem is key to economic growth and prosperity. The Founder and Startup Support Programme plays an important part in further developing this ecosystem. The procurement process for this programme resulted in six providers appointed to provide specialist support services for founders.
As part of the overall procurement process we were trialling a more intensive due diligence process which was the subject of the OAG inquiry. While well-intentioned, we acknowledge that parts of our trial due diligence process did not meet best practice.
Put simply, we should have told potential suppliers upfront about specific details of the due diligence process (in particular which provider will be used to conduct it) and given Manaaki more opportunities to respond before finalising the report – we accept that was a failing on our part and we have apologised for the shortcomings in our process and the impact on Manaaki in particular. We also accept that we should have put in place additional special information security and confidentiality procedures, given the potentially sensitive nature of information discovered in intensive due diligence processes.
Our job now is to ensure we address the findings of the report and ensure our future procurement process exceeds expectations.
These improvements include changes resulting from our earlier engagement with Manaaki regarding their concerns about the due diligence at issue, and suggestions from the independent EY report we commissioned into the process and recommendations from the OAG’s report.
We have also commissioned an independent review of our approach to identifying conflicts of interest that will inform best practice changes. There are also measures underway to improve confidentiality and information security and improved electronic document security.
Our priority is ensuring all our procurement processes exceed expectations.