Equator Principles begins drafting third iteration

9 November 2011 - Environmental Finance, Christopher Cundy

The Equator Principles Association has begun compiling its second major revision to the eponymous guidelines for managing environmental and social risks in project finance. The association held its largest ever annual meeting last month, with close to 100 people attending, where options for revising the principles were presented. The review follows a revision to the International Finance Corporation Performance Standards, upon which the Equator Principles are based, and an independent report published earlier this year. Read More.

Belo Monte Dam Does Not Meet Equator Principles, Say Rights Groups

7 November 2011 - International Rivers

The controversial Belo Monte Dam, slated for construction in Brazil's Amazon region, does not meet the standards of an international framework used by the world's largest private banks to evaluate sustainability, say human rights groups in Brazil. In a letter sent to Itaú, Banco do Brasil, Bradesco, Santander, and Caixa Econômica Federal, 150 Brazilian social and environmental organizations warned that Belo Monte developer Norte Energia, S.A. (NESA) has not complied with the Equator Principles, a set of voluntary standards created in 2003 that aid private financiers in assessing and managing social and environmental risk in project finance. As signatories of the Equator Principles, the five banks commit to not providing loans to projects where the borrower will not or is unable to comply with the Principles' respective social and environmental policies and procedures. Read More.

Time to open up Equator Principles – BankTrack

25 October 2011 - Environmental Finance, Christopher Cundy

A banking industry initiative on social and environmental risks in project finance should become more transparent and expand its scope, according to campaigners. Financial institutions that have signed up to the Equator Principles (EPs) – a credit risk management framework for determining, assessing and managing environmental and social risk in project finance transactions – are meeting in Washington, DC this week to discuss a third update to the EPs.  This follows the recent update to the IFC’s Performance Standards, upon which the EPs are based, and a review published in May. Read More.

Time to Improve the Equator Principles, BankTrack Says

24 October 2011 - Sustainability Investment News , Robert Kropp

As the Equator Principles Association prepares a draft of new principles, BankTrack calls for increased transparency and more attention to climate change and human rights. Banks subscribing to the Equator Principles commit to managing environmental and social risks in their project finance transactions. At present, 70 banks in 27 countries have been designated as Equator Principles Financial Institutions (EPFIs). EPFIs fulfill their mission by not financing projects that are not in compliance with social and environmental policies and procedures established by the International Finance Corporation (IFC) and the World Bank. Four of the 70 EDFIs—Bank of America, Citigroup, Ex-Im Bank, and JPMorgan Chase—are based in the US. The Equator Principles Association is scheduled to release a draft text of its new version of the Principles this week, a step made necessary by the publication in August of a new Sustainability Framework by IFC. In advance of the Association's draft text, BankTrack, a Netherlands-based nongovernmental organization (NGO), has published recommendations to ensure that the draft text makes "a positive difference to project affected communities and to the environment.” Read More.

BankTrack to Equator Principles banks; ‘get the Outside Job done’

23 October 2011 - BankTrack

BankTrack, the global NGO network monitoring private sector bank operations, calls upon the Equator Principles Financial Institutions (EPFIs) to ensure that the next version of Equator Principles will better deliver on their core  Outside Job; make a positive difference to project affected communities and to the environment. The Equator Principles Association, meeting this week in Washington DC for their Annual Meeting, is about to publish the draft text of the new version of the Equator Principles (EPIII). The update became necessary after the International Finance Corporation recently adopted a new version of their Performance Standards, to which the Equator Principles are pegged. Read More.

Karak oil international gets official approval to commence its work

4 October 2011 - Ammonnews

An agreement for a British company to exploit Jordan’s vast oil shale resources has received official approval. It will create over 3,000 jobs and bring major economic benefits to the Kingdom. ...The KIO oil shale project will operate according to accepted international standards of best practice including the Equator Principles, the UN Global Compact and the International Labour Organization Declaration of Fundamental Principles and Rights at Work. KIO will operate to rigorous environmental standards that limit emissions and ensure optimal use of water. Read More.

Bridging the great infrastructure funding gap

28 September 2011 - The Asset, James Courtenay

Across emerging markets, much needed economic growth is hampered by a shortage of roads, telecommunications, airports, power plants and other basic infrastructure. The sheer magnitude of investment needed is staggering: World Bank estimates have suggested emerging markets will require at least USD900 billion of annual infrastructure spending up to 2020. Infrastructure is a key driver of productivity, competitiveness and growth in economies. Asia, Africa and the Middle East, in particular, all have huge infrastructure requirements over the next decade, as countries seek to move up the value chain while absorbing fast-growing numbers of citizens. However, funding the multitude of projects required in emerging markets – home to more than four fifths of the world’s population – is a huge challenge for governments and the financial sector, with Asia alone estimated to need around USD8.3 trillion of infrastructure spending up to 2020. Read More.

IFC UPDATED PERFORMANCE STANDARDS WEAK ON HUMAN RIGHTS, OTHER SHORTCOMINGS

14 September 2011 – Bretton Woods Project

The International Finance Corporation (IFC), the Bank’s private sector arm, has concluded a two-year review of its performance standards on environmental and social sustainability, but its weak human rights approach has angered rights organisations. The performance standards were introduced in 2006 to provide guidance for IFC clients to “avoid and mitigate adverse impacts and manage risk as a way of doing business in a sustainable way”.  Together with the policy on environmental and social sustainability and a new access to information policy, the eight revised performance standards make up the IFC’s updated sustainability framework. Approved by the board in May, the updated framework was only disclosed in early August and will come into force in January next year. Read More.

Sub-Saharan Africa - Sustainable investment on the rise

18 August 2011 - Financial Mail, Lise Pretorius

Sustainable investment in sub-Saharan Africa is on the rise. Not only are investors and companies under increasing pressure to take sustainability seriously in the run-up to COP17 (the UN Framework Convention on Climate Change, to be held in Durban this year), but SA has become a regional front-runner in promoting sustainable investment practices. SA is Africa’s biggest institutional investment market, with invested assets worth more than R4trillion and retirement funds of about half that amount. ..... But it is not to say that sustainable investment in general asset management is not growing. SA is already a world leader when it comes to governing listed equities on the JSE, most notably through King 3, which makes it mandatory for companies to include ESG analysis in their corporate reporting from 2011, through what is called integrated reporting. In reaction to local and international pressure, all four major SA banks have adopted the Equator Principles for project financing, through applying the IFC’s environmental and social standards to deals in Africa. Read More.

NGOs welcome reforms to IFC sustainability policies

11 August 2011 - Environmental Finance, Jess McCabe

NGOs have welcomed updates to the International Finance Corporation’s (IFC’s) guidelines for sustainable investment, which they say increase transparency.  Last week, the IFC released details of its new Sustainability Framework, which will come into effect in 2012.  The framework includes the Performance Standards, which set the environmental and social standards projects must meet to receive financing from the institution. The Performance Standards also underpin the Equator Principles, voluntary sustainability guidelines that commercial banks apply to project finance. William Bulmer, IFC director for environment, social and governance, said: “In addition to supporting IFC's own clients, the Performance Standards have become a global benchmark for sustainable business. We recognise this and have welcomed the very positive feedback from external stakeholders during our update process.” Read More.