How does UNOPS recover costs and what is covered by our management fee?
UNOPS is self-financing and therefore recovers costs through charging for its work. We do this in two ways. All costs relating to projects are called direct costs. These are charged directly to the project. They include project personnel, materials and premises and also shared direct project costs such as personnel insurance or security.
We also have indirect costs. For example, core corporate functions such as strategic leadership, training and development and United Nations governance. These enable UNOPS to provide efficient, transparent and innovative services to partners. The management fee pays for these indirect costs.
How does UNOPS calculate its management fee?
UNOPS keeps its management fee at a minimum. It is calculated individually for every project using a range of factors that impact on UNOPS costs. The management fee for projects can range from 2 per cent to 35 per cent of delivery. This range reflects the specific factors in each project, for example, the level of risk, the scale and the complexity. We believe that by making an individual assessment of each project we ensure that partners only pay for the services they receive. During the past five years our management fee averaged around 5.5 per cent of delivery.
How can you compare UNOPS cost recovery to other UN organizations?
UNOPS is a self-financing, not-for-profit member of the United Nations family. It operates on the basis of full cost recovery. Recovery of direct and indirect costs is fair and transparent and focusses on providing the most value to partners while maintaining the financial viability of the organization. In this regard UNOPS is distinct from other UN organizations only in so far that it does not receive assessed or voluntary contributions to fund its operations. To learn how UNOPS thinks about price, and how UNOPS focuses on increasing impact, please
read our factsheet or view the webinar below.