London, 28 November 2019
The Equator Principles Association Annual Meeting was held in Singapore on 18-20 November with attendees from over 60 Equator Principles Financial Institutions (EPFIs).
Launch of EP4
The fourth iteration of the Equator Principles (“EP4”) was launched at the opening of the Annual General Meetingand accompanied with a statement recognising the enormous support and contributions from a range of partners and stakeholders to the review.
The Steering Committee reported that there was a high turnout on the member vote (approx. 85), and 98.7% of participants voted in favour of the strengthened requirements. Taken together, this is considered an endorsement that, while resulting from a challenging process, the final EP4 succeeds in balancing a range of perspectives and circumstances. Ultimately the new Principles move global best practice for environmental & social risk in Projects a step forward.
Feedback to stakeholders
A document was released alongside EP4 that responds to the feedback received over the two-year review period. The document specifies how the many elements raised during the review of the Principles have been addressed in the final text of EP4. In other cases, the Association felt that certain elements would be more appropriately addressed via Governance Rules updates, training, or other efforts.
The Association has previously committed to more frequent but targeted reviews of the Principles. The Steering Committee will monitor for issues to cover in future reviews either of the Principles themselves or the associated guidance.
Chair handover and recognition
Standard Chartered was appointed the Chair of the EP Association Steering Committee on 21 November. This means that Standard Bank has now stepped down as the longest-serving Chair in the history of the Association (from 2015 to 2019). To mark this contribution, the Association awarded Nigel Beck of Standard Bank the Shawn Miller Award for EPA Leadership. (Shawn was a previous Chair of the Assocition from from Citi who led the EPIII review).
The Association recognised Standard Chartered for the great leadership they have demonstrated by stepping up to this critical and voluntary role.
The Association welcomed DBS as the first member from South East Asia, and who brings the Association beyond 100 members. The intent of holding the meeting in this region was to facilitate awareness amongst financial institutions in Singapore but also neighbouring countries including Viet Nam, India, Indonesia, Thailand, China and others which represent a significant share of the Project Finance market.
The meeting affirmed that the Association’s priority areas include improving internal consistency and robustness of application, and strengthened EPFI accountability. The incoming Chair has made refreshing the Association’s strategy their top priority, recognising the increasingly dynamic landscape of sustainable finance.
The strategy will maintain the EPs as a multi-lateral risk management framework, rather than a policy-setting body. In line with the Op Ed released in August members will continue to set their own level of risk appetite, according to the commercial and other circumstances that they individually face.
Support for EP4 effective date
In the coming months EP4 working groups will be developing associated guidance to support relevant stakeholders in the implementation by the effective date of 1 July 2020. Further communications will be released over the coming months on this topic.