diff --git a/Makefile b/Makefile
index 364de40a9..cd7ccd2a4 100644
--- a/Makefile
+++ b/Makefile
@@ -11,7 +11,7 @@ GOLANGCI_LINT_VERSION:=v1.43.0
 OPM_VERSION:=v1.24.0
 
 # Build Flags
-export CGO_ENABLED:=1
+export CGO_ENABLED:=0
 BRANCH=$(shell git rev-parse --abbrev-ref HEAD)
 SHORT_SHA=$(shell git rev-parse --short HEAD)
 VERSION?=${SHORT_SHA}
diff --git a/apis/addons/v1alpha1/addons_types.go b/apis/addons/v1alpha1/addons_types.go
index 1ee99cbbb..8ac2ef953 100644
--- a/apis/addons/v1alpha1/addons_types.go
+++ b/apis/addons/v1alpha1/addons_types.go
@@ -319,8 +319,11 @@ const (
 	// Addon has timed out waiting for acknowledgement from the underlying addon.
 	AddonReasonDeletionTimedOut = "AddonReasonDeletionTimedOut"
 
-	// Addon Instance is not yet installed.
+	// Addon instance is not yet installed.
 	AddonReasonInstanceNotInstalled = "AddonInstanceNotInstalled"
+
+	// Addon instance has been successfully installed.
+	AddonReasonInstanceInstalled = "AddonInstanceInstalled"
 )
 
 type AddonNamespace struct {
diff --git a/integration/addon_test.go b/integration/addon_test.go
index 68523ee04..0457c3db3 100644
--- a/integration/addon_test.go
+++ b/integration/addon_test.go
@@ -407,6 +407,88 @@ func (s *integrationTestSuite) TestAddonConditions() {
 		s.Require().Equal(addonsv1alpha1.AddonReasonMissingCSV, availableCond.Reason)
 	})
 
+	s.Run("sets_installed=true_with_install_ack_required", func() {
+		// Remove addon before starting the test.
+		s.addonCleanup(addon, ctx)
+
+		addon := addonWithInstallAck()
+
+		err := integration.Client.Create(ctx, addon)
+		s.Require().NoError(err)
+
+		addonCSV := &operatorsv1alpha1.ClusterServiceVersion{
+			ObjectMeta: metav1.ObjectMeta{
+				Namespace: "namespace-onbgdions",
+				Name:      "reference-addon.v0.1.0",
+			},
+		}
+
+		// Assert that the csv phase has succeeded while the
+		// addon is being installed.
+		err = integration.WaitForObject(
+			ctx,
+			s.T(), defaultAddonAvailabilityTimeout, addonCSV, "to have succeeded phase",
+			func(obj client.Object) (done bool, err error) {
+				csv := obj.(*operatorsv1alpha1.ClusterServiceVersion)
+				return csv.Status.Phase == operatorsv1alpha1.CSVPhaseSucceeded, nil
+			})
+		s.Require().NoError(err)
+
+		err = integration.Client.Get(ctx, client.ObjectKeyFromObject(addon), addon)
+		s.Require().NoError(err)
+
+		// Assert that the addon's installed condition is false.
+		// i.e. even though the csv phase has succeeded, addon doesn't report as installed.
+		s.Require().True(meta.IsStatusConditionFalse(addon.Status.Conditions, addonsv1alpha1.Installed))
+
+		instance := &addonsv1alpha1.AddonInstance{}
+		err = integration.Client.Get(ctx, types.NamespacedName{
+			Name:      addonsv1alpha1.DefaultAddonInstanceName,
+			Namespace: addon.Spec.Install.OLMOwnNamespace.Namespace,
+		}, instance)
+		s.Require().NoError(err)
+
+		// Assert 'Installed' condition is not present in addon instance.
+		s.Require().Nil(meta.FindStatusCondition(instance.Status.Conditions, addonsv1alpha1.AddonInstanceConditionInstalled.String()))
+
+		// We impersonate the addon's operator and report its addon instance as installed.
+		meta.SetStatusCondition(&instance.Status.Conditions, metav1.Condition{
+			Type:    addonsv1alpha1.AddonInstanceConditionInstalled.String(),
+			Reason:  addonsv1alpha1.AddonReasonInstanceInstalled,
+			Message: "Addon instance is installed",
+			Status:  metav1.ConditionTrue,
+		})
+
+		err = integration.Client.Status().Update(ctx, instance)
+		s.Require().NoError(err)
+
+		// Wait until addon has installed=true.
+		// i.e. Addon Instance has been installed & CSV phase has succeeded.
+		err = integration.WaitForObject(
+			ctx,
+			s.T(), defaultAddonAvailabilityTimeout, addon, "to be installed",
+			func(obj client.Object) (done bool, err error) {
+				a := obj.(*addonsv1alpha1.Addon)
+				return meta.IsStatusConditionTrue(
+					a.Status.Conditions, addonsv1alpha1.Installed), nil
+			})
+		s.Require().NoError(err)
+
+		err = integration.Client.Get(ctx, client.ObjectKeyFromObject(addon), addon)
+		s.Require().NoError(err)
+
+		// Assert that the required conditions are met.
+		instanceInstalledCond := meta.FindStatusCondition(instance.Status.Conditions, addonsv1alpha1.AddonInstanceConditionInstalled.String())
+		s.Require().NotNil(instanceInstalledCond)
+		s.Require().Equal(metav1.ConditionTrue, instanceInstalledCond.Status)
+		availableCond := meta.FindStatusCondition(addon.Status.Conditions, addonsv1alpha1.Available)
+		s.Require().NotNil(availableCond)
+		s.Require().Equal(metav1.ConditionTrue, availableCond.Status)
+		addonInstalledCond := meta.FindStatusCondition(addon.Status.Conditions, addonsv1alpha1.Installed)
+		s.Require().NotNil(addonInstalledCond)
+		s.Require().Equal(metav1.ConditionTrue, addonInstalledCond.Status)
+	})
+
 	s.T().Cleanup(func() {
 		s.addonCleanup(addon, ctx)
 	})
diff --git a/integration/fixtures_test.go b/integration/fixtures_test.go
index 08b000538..5e1f10a01 100644
--- a/integration/fixtures_test.go
+++ b/integration/fixtures_test.go
@@ -114,10 +114,8 @@ func addonWithVersion(version string, catalogSrc string) *addonsv1alpha1.Addon {
 		},
 		Spec: addonsv1alpha1.AddonSpec{
 			DeleteAckRequired: true,
-			// TODO: Modify reference-addon to report addon instance as installed without depending on the addon's availability
-			// InstallAckRequired: true,
-			Version:     version,
-			DisplayName: "addon-oisafbo12",
+			Version:           version,
+			DisplayName:       "addon-oisafbo12",
 			Namespaces: []addonsv1alpha1.AddonNamespace{
 				{Name: "namespace-onbgdions"},
 				{Name: "namespace-pioghfndb"},
@@ -140,6 +138,38 @@ func addonWithVersion(version string, catalogSrc string) *addonsv1alpha1.Addon {
 	}
 }
 
+func addonWithInstallAck() *addonsv1alpha1.Addon {
+	return &addonsv1alpha1.Addon{
+		ObjectMeta: metav1.ObjectMeta{
+			Name: "addon-oisafbo12",
+		},
+		Spec: addonsv1alpha1.AddonSpec{
+			DeleteAckRequired:  true,
+			InstallAckRequired: true,
+			Version:            "v0.1.0",
+			DisplayName:        "addon-oisafbo12",
+			Namespaces: []addonsv1alpha1.AddonNamespace{
+				{Name: "namespace-onbgdions"},
+				{Name: "namespace-pioghfndb"},
+			},
+			Install: addonsv1alpha1.AddonInstallSpec{
+				Type: addonsv1alpha1.OLMOwnNamespace,
+				OLMOwnNamespace: &addonsv1alpha1.AddonInstallOLMOwnNamespace{
+					AddonInstallOLMCommon: addonsv1alpha1.AddonInstallOLMCommon{
+						Namespace:          "namespace-onbgdions",
+						CatalogSourceImage: referenceAddonCatalogSourceImageWorking,
+						Channel:            "alpha",
+						PackageName:        "reference-addon",
+						Config: &addonsv1alpha1.SubscriptionConfig{
+							EnvironmentVariables: referenceAddonConfigEnvObjects,
+						},
+					},
+				},
+			},
+		},
+	}
+}
+
 func addonWithAdditionalCatalogSource() *addonsv1alpha1.Addon {
 	return &addonsv1alpha1.Addon{
 		ObjectMeta: metav1.ObjectMeta{