Remaining Obstacles to Revisions of IFC Performance Standards
The third and final phase of IFC’s consultation process for the Sustainability Framework Review and Update ended on March 4. Where do we go from here?
The International Finance Corporation (IFC), which is the private sector oriented arm of the World Bank Group, wrapped up its third round of consultation on the revision of the IFC Performance Standards. Now, the IFC needs to figure out how to integrate input on biodiversity, climate change, Free Prior Informed Consent/Consultation, human rights and also requests to apply them to Financial Intermediaries. And IFC still needs to make sure the final version remains reasonably palatable to its Board – in addition to NGO/Communities, Equator Banks and Investors. The balancing acts required here would steal the show at any circus.
One of the more interesting feedbacks provided to the IFC came from the Equator Principles Association Steering Committee. This group represent some 70 project finance banks and I have blogged about the Equator Principles before, including here and here. The EP Association submitted its original comments already in July 2010. Interestingly, they felt the need to re-iterate these again, following a meeting with the IFC in February 2011. The letter highlights Climate Change related issues as a key priority and requested strengthened language around, for example, Best Available Technology (BAT) in the context of coal-fired power plants. The letter touches also on other topics, including a preference to retain the term Free Prior Informed Consultation (instead of FPI-Consent), about which I blogged before here.
For those of you interested in the mining sector, you may find the detailed submission by the International Council on Mining and Metals (ICMM) an interesting read. You may also be interested in one of my past blogs/articles about lessons learned applying the IFC Performance Standards in the context of mining projects which can be accessed here.
The IFC expects to submit the final version for approval by its board by the end of 2011. – Did you attend consultation meetings with the IFC? What do you feel are the biggest challenges IFC will need to address?
About the author: Mehrdad Nazari (MBA, MSc, LEAD Fellow) is a Corporate Responsibility, Sustainability Reporting & ESIA Advisor, and Director of Prizma. He was previously an environmental consultant with Dames & Moore, Principal Environmental Specialist at the EBRD and CSR Research Director at CoreRatings. Mehrdad is also a GRI-approved trainer on GRI's sustainability reporting framework and a licensed AA1000 Assurance Provider.