2 alex indorf ifc presentation workshop on climate change + sustainability

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Sesión III: Iniciativas regionales para impulsar la implementación de estándares de gobernabilidad corporativa
ambiental y social en sistemas financieros / Presentación Alexander Indorf, Banco Mundial / IFC

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  • Key Points: The reason why IFC has consistently made a profit since its inception is due to the fact that it goes in with its eyes open to any deal – we’re well known for our comprehensive due dilgence. Speakers Notes: The reason why IFC has consistently made a profit since its inception is due to the fact that it goes in with its eyes open to any deal – we’re well known for our comprehensive due dilgence. At times to clients, that might seem like a drawback – more questions asked, more actions required and more time taken before they get their money but there is also an appreciation that the process brings benefit too – a fitness test which can provide significant value to a client’s business. The need for rigorous analysis is also due to the nature of the environments where IFC does business: - emerging and frontier markets - difficult investment climate e.g. poor regulatory, governance or legal structures to support private sector enterprise Successful investments in such environment requires strong sponsors and a comprehensive due-diligence of the risks Sustainable investments require looking beyond the immediate financials and taking a longer term look and in particular, on the broader impact it will bring. Will communities support and benefit from it? Regulators? Staff? Investors?
  • Key Point: In addition to the generalized support we provide to the investment process, there are also specialist resources to draw on. Speakers Notes: Different projects – and different clients – have different needs. Beyond the generalized support that we provide to the investment process, we also have specialist resources to draw on. These cover a broad range of issues. Large complex projects may required a number of these specialist resources. Others may benefit from IFC support in one specific area.
  • 2 alex indorf ifc presentation workshop on climate change + sustainability

    1. 1. Alexander W. Indorf, Sr. Environmental Specialist IFC’s Environmental and Social Sustainability Framework Workshop on Mitigation of Climate Change and Sustainability, Bogotá, November 19, 2010
    2. 2. International Bank for Reconstruction and Development, 1945 International Finance Corporation, 1956 International Development Association, 1960 Multilateral Investment Guarantee Agency, 1988 IFC is owned by its 176 member countries, which collectively determine policies. International Centre for Settlement of Investment Disputes, 1966 IFC: Part of the World Bank Group
    3. 3. IFC’s Products and Services To assist private enterprise in developing countries, IFC:  Provides loans and equity for viable projects  Mobilizes capital from other sources  Provides technical assistance and advisory services
    4. 4. IFC Social & Environmental Standards  Building blocks for IFC approach to sustainability ―IFC Sustainability Policy ―Performance Standards ―Disclosure Policy ―EHS Guidelines  Together these provide a framework to: ― Manage project risks ― Improve performance ― Maximize development impact
    5. 5. IFC’s Sustainability Policy Framework Disclosure Policy Sustainability Policy Environmental & Social Review Procedure  8 Guidance Notes  Environmental, Health & Safety Guidelines  Best Practice Materials IFC – Institutional Client – Project level Requirements Implementation 8 Performance Standards
    6. 6. Overview Performance Standards  PS 1: Social & Environmental Assessment and Management System  PS 2: Labor and Working Conditions  PS 3: Pollution Prevention and Abatement  PS 4: Community Health, Safety & Security  PS 5: Land Acquisition and Involuntary Resettlement  PS 6: Biodiversity Conservation and Sustainable Natural Resource Management  PS 7: Indigenous Peoples  PS 8: Cultural Heritage
    7. 7. How the Performance Standards are Used  Basis of client’s assessment and management ―The client must establish that its future operations will meet the standards  Basis of IFC’s E&S review of the project ―IFC assures its board that the project can be expected to meet the standards ―CES Management System tracks project compliance, performance  Basis of IFC’s reporting on development effectiveness ―E&S performance indicators in part based on the standards  Basis of the Equator Principles, others
    8. 8. The Equator Principles in a nutshell  Environmental and social risk management framework for project finance  Based on IFC’s Performance Standards and Environmental, Health and Safety Guidelines  First announced in June 2003 with ten banks - Relaunched as “EP2” in July 2006, referring to the new IFC standards  Over 60 financial institutions globally, including several in emerging markets ―http://www.equator-principles.com/index.shtml  Gather annually at Community of Learning event together with ECAs and BFIs
    9. 9. Climate Change within IFC’s Sustainability Framework – 2010 ― Policy commitment to low-carbon development and better reporting ― Integrate in environmental and social assessment ― Improve efficiency of use of resources ― Reduce GHG project emissions through good international practice ― Increase reporting requirements on GHG emissions  100,000 tons CO2 to 20,000 tons ― Ecosystems approach 9
    10. 10. 10 - Formally initiated in FY08 as an IFC Strategic Priority - FY08-10: developing the analytical foundation – tools and methodologies • est. GHG emissions from investments (requirement for all real sector 2/10) • Evaluating climate risks (pilot projects) • Tracking and reporting clean energy • Shadow price pilot - New investment/strategy department FY11: Climate Business Solutions Group Climate Change within IFC’s Investment Strategy
    11. 11. Challenges in Implementation  IFC works in emerging and frontier markets  Investment climate is often difficult – e.g., poor regulatory, governance or legal structures to support private sector enterprise  To invest successfully, IFC needs committed sponsors and a comprehensive due-diligence of the risks  To invest sustainably, IFC needs to ensure that development outcomes are maximized
    12. 12. IFC’s Environmental and Social Department  Pollution prevention  Cleaner production  Socioeconomic/workplace/ labor issues  Land acquisition/ resettlement/compensation  Indigenous peoples  Biodiversity  Community Development & Consultation  Forestry  Cultural property  Impact assessment  E&S management systems  Health & Safety • Over 60 Environmental and Social Specialists globally • Collocated with IFC’s Investment Departments across all industry sectors and regions
    13. 13. Links and Contacts  http://www.ifc.org/sustainability Alexander W. Indorf, Sr. Environmental Specialist, Regional Team Leader (LAC), CES Department E-mail: aindorf@ifc.org Phone: +55-11-5185-6885

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