The Newly Revised IFC Performance Standards - Guidance on Implementation By EP Association Members From 1 January 2012

7 December 2011

The IFC has updated its Sustainability Framework, which includes the newly revised Performance Standards, and the IFC will be applying them from 1 January 2012. Consistent with the current Equator Principles (EP) framework, the EP Association Steering Committee has agreed that the newly revised IFC Performance Standards will also take effect for EP Association Members on 1 January 2012. Accordingly Exhibit III of the EPs (which refers to the 2006 IFC Performance Standards) will be updated on 1 January 2012 to reflect their implementation by EP Association members under the current EP framework.

Read more...

Putting some bite into the Equator Principles

29 November 2011 - Project Finance Magazine

There has been persistent scepticism about the Equator Principles’ ability to encourage best practice at participating banks. But evidence from the mining industry is that they are changing sponsor behaviour. By Christopher Langdon and Claudia O’Brien, partners, Latham & Watkins. Since 2003, Equator Principles financial institutions, most of them major banks, have provided about 85% of the world’s project finance capacity. These institutions provide financing only to projects that comply with the Equator Principles, a voluntary set of guidelines designed to ensure large projects are financed in socially and environmentally responsible ways. Read More.

Chinese carbon market has 'potential'

17 November 2011 - China Daily, Wei Tian

The carbon market in China has "substantial" potential, and will be decisive to the global carbon price once a national system emerges, Rachel Kyte, Vice-President of the World Bank, said on Wednesday. … Kyte called for more Chinese banks to sign up for the Equator Principles, a set of guidelines that require signatory banks to take into account environmental and social issues when financing development projects.  … "Chinese banks are increasingly global players, and it would be important to see major banks in China adopting a principle that is also globally recognized," Kyte said. Read More.

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.

Groundbreaking Bank Program Aims to Make Biodiversity a Key Factor in Lending Decisions

8 November 2011

The Equator Principles Association, World Wildlife Fund (WWF) and the Business and Biodiversity Offsets Program (BBOP) today announced the launch of a pioneering training program to help banks incorporate the value of nature into their lending decisions.

The Biodiversity for Banks (B4B) program is designed to help financial institutions overcome the challenges of incorporating risks associated with biodiversity and ecosystem services – all of the valuable resources provided by nature including safe drinking water – into their lending decisions.

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.

Export Development Canada elected to Steering Committee of Equator Principles

4 November 2011

Export Development Canada (EDC) announced today that it was elected to the Steering Committee of the Equator Principles (EP) Association  last week. The Equator Principles are a financial industry benchmark for determining, assessing and managing social and environmental risk in project financing.  Currently 73 financial institutions in 27 countries have officially adopted the EPs, covering over 70 percent of international project finance debt in emerging markets. EDC first adopted the EPs in 2007, reflecting EDC’s ongoing commitment to conduct its international business in a socially and environmentally responsible manner.   EDC is the first export credit agency and the first Canadian financial institution to be represented on the Steering Committee. 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.

The Equator Principles Association hosts its largest ever Annual Meeting, launches the Biodiversity for Banks Program and contributes to the IFC's Community of Learning

24 -27 October 2011

The Equator Principles (EP) Association held its largest ever Annual Meeting on 24 October 2011 in Washington DC. Equator Principles Financial Institutions (EPFIs) and Associates discussed and debated numerous important topics related to the EP III Update process. Members heard proposals from Task Forces and Working Groups, who have been working on key thematic areas arising out the EP Strategic Review, including scope, climate change, reporting and transparency and further proposals on how to integrate the new IFC Performance Standards language on social risks, stakeholder engagement and human rights into EP III.

Read more...