_ What are Equator Principles ? WHAT ARE EQUATOR PRINCIPLES ? The Equator Principles are : “a financial industry benchmark for determining, assessing and managing social & environmental risk in project financing ” (www.equator-principles.com) Equator Principles were launched in 2003 by ten international banks, Equator Principles have now become a global standard for project finance. EPs provide a framework for the environmental and social evaluation of projects: compliance with local law in High Income OECD countries and with IFC social & environmental policies and quantitative environmental guidelines elsewhere A voluntary agreement , but “Equator has teeth”: Adopters agree that they “will not provide loans directly to projects where the borrower will not or is unable to comply with our environmental and social policies and procedures”. In August 2011, EP has been adopted by around 70 banks
_ What are the Equator principles requirements ?
Screen the level of social & environmental risk associated with all applicable project financings and assign a risk category :
Category A – Projects with potential significant adverse social or environmental impacts that are diverse, irreversible or unprecedented
Category B – Projects with potential limited adverse social or environmental impacts that are few in number, generally site-specific, largely reversible and readily addressed through mitigation measures
Category C – Projects with minimal or no social or environmental impacts
TEN PRINCIPLES 1/ Review and categorisation 2/ Social and Environmental assessment 3/ Applicable Social & Environmental standards 4/ Action plan and management system 5/ Consultation and disclosure 6/ Grievance Mechanism 7/ Independent review 8/ Covenants 9/ Independent monitoring and reporting 10/ EPFI reporting