The IFC extends review of its Performance Standards and related policies

The International Finance Corporation (IFC), the private sector arm of the World Bank, announced in 2009 that it would be reviewing the social and environmental policies and standards that it uses to guide and regulate its lending in vulnerable sectors. This review has been on-going and has seen extensive engagement by civil society and by indigenous peoples’ representatives and organisations.  Although the review was expected to end in August 2010, the IFC has just announced an extension to this process.

During Phase Two of the review, with proposed text changes provided to the public, many organisations provided the IFC with written input and participated in workshops and consultations held around the world.  Of specific interest to indigenous peoples, the IFC held a workshop in Washington DC on July 29, 2010, to discuss the issues around the possible adoption of the standard of ‘Free, prior and informed consent’ for indigenous peoples for certain project types. Although the discussion was detailed and explored the issues well, there is no indication yet as to whether the IFC will adopt this standard, widely seen as vital to ensuring the cultural and economic survival of indigenous peoples. It is also worth noting that the workshop was a closed meeting, to which indigenous peoples were unable to nominate their representatives or themselves to attend.

The IFC has now announced that it will extend the review process by holding a ‘Phase Three’ of discussions, during which they will again hold thematic and geographically focused consultations and workshops around the world. This new phase will also include a new proposed text from the IFC which should incorporate the inputs they received during Phase Two. The exact dates of Phase Three are not yet known and details of the consultations and workshops are not yet available. Given previous experience, it is hoped that in future meetings on FPIC, appropriate methods of consultation are used: including allowing indigenous peoples to self-nominate participants; sharing information regarding the event well ahead of time; and facilitating detailed discussions over a sufficient period of time (certainly more than a few hours).

The IFC policies and standards are not only important for the huge portfolio of lending of the IFC, but also for the lending that many private sector banks do. The performance standards of the IFC form the so-called ‘Equator Principles’ - a voluntary set of standards that many private sector banks have signed up to - and therefore improvements in the IFC policies and standards may have a far wider impact than just on IFC projects.

FPP will continue to provide updates and information on this process on the IFC section of the FPP website