BankTrack not Satisfied with new Draft of Equator Principles

12 October 2012 - Social Funds, Sustainability Investment News - Robert Kropp

While acknowledging that the new draft is an improvement, the Netherlands-based NGO finds insufficient commitments by signatory banks to transparency, human rights, and climate change mitigation. Some of the most environmentally damaging practices of the extractive industries - mountaintop mining and extensive deforestation, to name but two-remain perfectly legal, despite their contributions to climate change and destructive effects on communities. Such operations require a great deal of money; and since policymakers in the US and elsewhere seem unprepared to outlaw the practices, the Equator Principles were launched in 2003 to bring the management of environmental and social risks to Project Finance transactions. Read More.

Equator Principles to be extended and strengthened but still no bite

11 October 2012 - Environment Bulletin, Herbert Smith

The Equator Principles Association (EPA) has released a third version of the Equator Principles (EPs) for public consultation and comment. The EPA's stated purpose in updating the EPs is to ensure that they remain "gold standard" for environmental and social risk assessment and management in financing. The key changes proposed by the draft are the extension of the application of the EPs beyond their current project finance scope to cover project-related corporate and bridge loans, a greater emphasis on human rights and climate change, and enhanced monitoring and reporting requirements for lenders and borrowers. Read More.

Banking on Sustainability: Is the Financial Sector Doing Enough?

27 September 2012 - Guardian Sustainable Business Blog, Roger Cowe

There is talk of culture change and low carbon principles in the global banking sector, but the industry must do far more to build sustainability into new strategies.  ... The Equator Principles, which attempt to limit financing of damaging infrastructure projects such as destructive dams, have 77 signatories including many of the world's largest banks. A third version of the principles, originally launched in 2013, will soon be finalised, extending their scope and strengthening reporting requirements.  Read More.

International Business Obligations: Review of project financing principles

26 September 2012 - Allens - Linklaters, Louise Jenkins, Catie Shavin and Loren Atkins

The Equator Principles, which promote environmentally and socially responsible project financing, are in the process of being updated. Although, initially, it may seem that the revised principles will increase signatories' obligations, their enhanced alignment with other international standards will facilitate a streamlining of financial institutions' policies and processes. Read More.

The Revised Equator Principles Call on Companies to Seek Free, Prior, and Informed Consent. Next up Governments

7 September 2012 - Foley Hoag, Corporate Social Responsibility and the Law, Amy K Lehr

The new draft Equator Principles reflect and build upon theIFC Performance Standards’ requirement that companies obtain the free, prior, and informed consent ("FPIC") of indigenous peoples for development projects. This language reflects the UN Declaration on the Rights of Indigenous Peoples (“UNDRIP”), which was supported by all but four countries in the UN General Assembly in 2007. The four countries that originally voted against the Declaration – the United States, Canada, Australia, and New Zealand – have since reversed their positions.  Although the Declaration is a soft law instrument and therefore not binding on companies, given the broad support that it received at the UN General Assembly, it is certainly persuasive. And, in fact, national courts of countries including Belize and Colombia have begun to cite to the Declaration in their court decisions related to indigenous peoples. Read More.

Clifford Chance Comment: Draft of updated Equator Principles released

29 August 2012 - Clifford Chance

Following a strategic review of the Equator Principles ("EPs"), the Equator Principles Association, which governs membership and use of the EPs, has released a draft of the updated EPs for stakeholder consultation and public comment. As well as expanding the types of projects that will be subject to the EPs, it also proposes enhanced reporting requirements. If approved, it will be the third version of the EPs and so is known as "EPIII". This briefing sets out the principal changes. Read More.

Equator Principles get an overhaul

22 August 2012 - Corporate Register

A new draft of the Equator Principles on ethical project finance has been released for consultation. The draft will be the third version of the principles, which were launched in 2003 and are regarded as a living document by the Equator Principles Association, which is their custodian.  Read More.

Revised Draft Equator Principles (EP III) Released For Stakeholder Consultation And Public Comment

21 August 2012 - Mayer Brown, Paul Forrester

On August 13, 2012, following the recent conclusion of a strategic review launched in October 2010, the Equator Principles Association (EPA) released the latest draft of the Equator Principle ... Read More.

Third Time Lucky for the Equator Principles?

17 August 2012 - Project Finance

Six years after its last update, a third update of the Equator Principles (EP) has been released for Stakeholder Consultation.  Member institutions began discussions on the proposed changes to the principles in July last year, with the aim of broadening their impact and improving disclosures under the voluntary project finance code. Read More.

Developers must opt for low carbon to win institutional funding

14 August 2012 - Link2, David Thorpe

Borrowers seeking loans from institutional investors must scope low carbon-emitting alternatives to potential projects before they can receive funding, in a major revision of principal investment guidelines. The guidelines in question are the Equator Principles, which are used by 77 institutional investors as a way of gauging the environmental and social implications of projects seeking backing. They already apply to project finance advisory services and project financing over $10m; and it is proposed that they are extended to cover project-related corporate loans and bridge loans.  ... Other proposed changes are new requirements related to managing the impacts of projects on climate change, and an increased emphasis on the consideration of human rights in due diligence. This includes taking into account the UN "Protect, Respect and Remedy" Framework for Business and Human Rights and Guiding Principles on Business and Human Rights.  Read More.