UN Global Compact: Canadian launch of the Guiding Principles

Janne Duncan writes about the the UN Global Compact (UNGC) Canadian launch this year and how it fits into related sustainability initiatives of the Government of Canada.

Export-Import Bank Sued by Environmental Groups for Coal Export Loan Guarantee

Columbia Law School's Climate Law Blog discusses a recent lawsuit by the NGO Earthjustice against US Ex-Im, regarding the Defendant's alleged failure to conduct an environmental assessment for a coal production related loan.

Managing Lender Liability in Equator Principles Implementation - Regulatory Offences

The Equator Principles III ("EP III") states that: "As financiers and advisors, we work in partnership with our clients to identify, assess, and manage environmental and social risks and impacts in a structured way, on an ongoing basis." It is well known that lender liability for environmental and social matters may arise from operational or managerial control by a lender over a project, or where a lender aids and abets regulatory offences of their borrowers. This article considers the risks associated with regulatory prosecutions of an Equator Principles Financial Institution (EPFI), acting as auditors and possibly co-managers of environmental and social risk management of their borrowers. We also consider management strategies, including the role of legal professional privilege. This article is part three of a three part look at managing lender liability in EP implementation.  The first article looked at post-loan legacy liabilities, and the second at third party beneficiary rights in the EP context.

Managing Lender Liability in Equator Principles Implementation - Third Party Beneficiary Rights in Contract Law

I read an interesting and provocative journal article by Marissa Marco, published in the Fordham International Law Journal in 2011, entitled "Accountability in International Project Finance: The Equator Principles and the Creation of Third-Party Beneficiary Status for Project-Affected Communities".  The article discusses the law on third party beneficiary rights under US contract law and considers whether the provisions of the Equator Principles (EP) relating to Affected Communities might create enforceable rights for those communities under those principles.

This article will discuss this issue and suggest a risk management strategy for EP Financial Institutions (EPFI - i.e. EP signatories) addressing and managing such risks in Equator Principles implementation.

Managing Lender Liability in Equator Principles Implementation - Legacy Liabilities (Post-Loan following Repayment or Default)

This post will consider a rather controversial topic - the possible existence of liabilities linked to Equator Principles (EP) implementation that may extend beyond the life of the underlying loan or activity to which the EP were originally applied.

The purpose will be to consider whether there are plausible legacy liability risks affecting EP implementation and, if so, how such risks could be managed by Equator Principles Financial Institutions (EPFI) before they materialize.

Please note that, as this is a blog post, the analysis is high level and intended to raise points for reflection and thought rather than to be an exhaustive review of the law on these subjects. Hopefully it raises some useful considerations and I am very much open to comment (and criticism) of the topic and ideas put forward. The goal is to generate a dialogue that may help push the boundaries of our understanding of these issues.

Climate Conversations - Norway’s government pension fund divests from palm oil producers

Norway’s government pension fund – one of the world’s largest – has withdrawn US$314 million in investments from a string of companies that it says produce palm oil “unsustainably”.

As AlertNet reports, in March, the Norwegian Government Pension Fund Global released its 2012 Annual Report announcing that it had sold its stakes in 23 of the world’s largest palm oil companies, reducing its investments in the Indonesian and Malaysian palm oil industry by more than 40 percent.

To Compliance and Beyond: Getting the Most From Global Incident Investigation

Michael Tooma and Michael Torrance write about global incident investigation in this month's Mining People and Environment magazine. For more information on this topic see my earlier blog post here on global incident investigation.

World Bank Compliance Advisor Ombudsman 2012 Annual Report

The Compliance Advisor Ombudsman (CAO) of the World Bank, which oversees implementation of the IFC Performance Standards on Environmental and Social Sustainability for the IFC and MIGA, released its 2012 Annual Report. The Report provides an overview of CAO's work in the busiest year for the office since it was established in 1999. CAO has seen a consistent increase in requests for its services, and handled 33 cases during the year through its dispute resolution and compliance functions. This year's report focuses on outcomes delivered by CAO in FY2012, in addition to a summary of outreach activities, M&E findings, and advisory work.

Technical Revision of the World Bank Group Environmental, Health, and Safety Guidelines

The World Bank Group has begun a three-year process to review and update its Environmental, Health and Safety (EHS) Guidelines. More information can be found on the International Finance Corporation (IFC) website HERE.

The EHS Guidelines are technical reference documents with general and industry-specific examples of Good International Industry Practice (GIIP). They contain the performance levels and measures that are normally acceptable to the World Bank Group, and that are generally considered to be achievable in new facilities at reasonable costs by existing technology. They are used by the World Bank, IFC and Multilateral Investment Guarantee Agency (MIGA).

The Equator Principles and Performance Standard 6 on Biodiversity Conservation - An Evolving Concept with Broad Implications

Performance Standard 6 of the IFC Performance Standards on Environmental and Social Sustainability (IFC Performance Standards) deals with the topic of Biodiversity Conservation and Sustainable Management of Living Natural Resources.  Performance Standard 6 has been the focus of a lot of attention and industry research with significant implications for the Equator Principles (EP) and EP Financial Institutions (EPFI) and their clients (Clients). This post discusses some of these developments and their implications, with reference to guidance from a chapter on Performance Standard 6 by Richard King and Lucas Thacker in the book IFC Performance Standards on Environmental and Social Sustainability: A Guidebook, published by Lexis Nexis in 2012.