In the News

The impact investing community needs to create innovative accountability tools to deal with high-risk environments and ensure their investments are delivering positive social and environmental impacts. This was the message delivered by Natalie Bridgeman Fields, founder and executive director of Accountability Counsel, and Gayle Peterson, director of social finance and impact investing programs at Saïd Business School, during a side event held as part of the Skoll World Forum in Oxford on Thursday.

The potential perils of privileging the private sector were highlighted by a recent UK National Audit Office report on public-private partnerships (PPPs), which probed the fiscal cost of PPPs, and a December report by Belgium-based CSO Counter Balance, which stressed the social and environmental risks of the Bank’s push for mega-infrastructure projects. Indeed, Natalie Bridgeman Fields of US-based CSO Accountability Counsel argued in a February Devex op-ed that the Bank’s private-sector promotion, “will be a setup that harms the poor and vulnerable and widens the wealth and equity gap.”

In 2010, Grupo Comexhidro wanted to build a small hydroelectric power plant on Sal creek, and cleared a one-kilometer stretch of shoreline to do so. But according to residents of Santa Úrsula the company did not consult with them and little information regarding the project was made public. With the support of several non-governmental organizations, including the international Accountability Counsel, residents halted the project.

Last week, a bipartisan group of senators and representatives introduced the Better Utilization of Investment Leading to Development (BUILD) Act, which, if enacted, would create a new agency called the United States International Development Finance Corporation. The IDFC would absorb the Overseas Private Investment Corporation — the U.S. development finance institution that encourages American businesses to invest in developing countries by providing businesses with loans or insurance — as well as several functions currently performed by the U.S. Agency for International Development. The bill could likely receive White House support as the administration similarly called for a new DFI in its 2019 budget proposal.

The bipartisan bill introduced Tuesday proposing the creation of a new United States development finance corporation could be a landmark piece of legislation, altering the U.S. development landscape for years or decades to come. The new DFC needs strong environmental and social policies and a strong accountability mechanism, said Stephanie Amoako, a policy associate at Accountability Counsel. The legislation should make clear whether OPIC’s office of accountability will continue as the mechanism for registering grievances or whether a new independent accountability mechanism will be created according to international best practices, she said.

Across a narrow channel from this historic port town, where baobabs tower over the forest and tiny crabs skitter in and out of the mangroves, Kenya could soon get its first coal-fired power plant, courtesy of China. The plan’s champions, including senior Kenyan officials, say the plant will help meet the country’s fast-growing demand for electricity and draw investment. Its critics worry that it will damage the area’s fragile marine ecosystem, threaten the livelihoods of fishing communities and pollute the air.

“The request for refinancing presents an important opportunity to finally achieve resolution on a number of these outstanding issues … we urge the World Bank Group to take this important opportunity to demonstrate its commitment to accountability and ensure access to remedy for project-affected peoples,” said a letter sent to World Bank chiefs earlier this month which was signed by more than 20 local and international NGOs, including the Accountability Counsel, Bank Information Center, Bretton Woods Project, Friends of the Earth US, and International Rivers.

Addressing harm caused by bank projects, promoting inclusion of vulnerable groups, and ensuring accountability should be Kim’s most urgent priority. Once these fundamental problems are addressed, the bank can better meet its own objectives and deliver value to the private sector as it too looks to create impact.

As the U.S. government retreats from leadership on climate, the Chinese are stepping up, both with new “green” policies and a leading role in finance, at home and abroad. This shift has notable implications for the millions of people affected by Chinese overseas investment in dams, mines, and pipelines.

Human rights successes are hard-won, require the coordinated efforts of many people working in solidarity — often across backgrounds, sectors, and even international borders—and are often overlooked by mainstream media, which focuses on the disastrous here, now, and clickable.

Electricity consumers will pay a fixed charge of Sh37 billion per year through their bills towards Lamu coal-fired power plant, irrespective of whether it generates power or not. The Treasury’s latest budget policy statement indicates that $360 million (Sh37 billion) will be paid yearly to the developers, Amu Power Company, as “annual fixed capacity payments”. The planned payout is Sh5 billion more than what it cost to build the 50km Thika superhighway. Homes and businesses will pay the hefty bill for the 1,050-megawatt plant through their monthly bills to cover the developers’ fixed expenses on the project, regardless of whether they generate electricity or not.

Democracy and development had a landmark year in Nepal in 2017. Nepal held local, provincial and national parliamentary elections, which were celebrated for being the first conducted under the new federal constitution which, however, is criticized for being regressive and discriminatory towards Indigenous Peoples and Madhesis.

To help staff make better decisions, the International Finance Corporation is introducing a new incentives framework, which will reward achievements in development outcomes. The new framework may be a welcome step, but the World Bank Group, which includes the IFC, has said incentives will reward staff on their ability to mobilize private sector funding. It’s critical that the IFC include in their rewards scheme recognition of staff that respect human rights.

Is a World Bank funded project stifling agency and voices of its female employees? As diplomats, civil society organizations, governments and businesses gather in Geneva to talk about the role of business to respect and protect human rights, a company – backed by the World Bank – is failing at both. Amalgamated Plantations Private Limited (APPL), the second largest producer and supplier of tea in India, is a joint venture of the Tata Group and the World Bank’s private sector side, the International Finance Corporation (IFC).

On 27 November, throngs of people attended the first day of the UN Forum on Business and Human Rights in Geneva, Switzerland. The three-day forum will see participants from business, government, and civil society have heated debates – over hot cups of tea and coffee – on how to protect human rights in a business context.

The World Bank has been urged by six Indian and international NGOs on Monday to improve the lives of tea workers to ensure fulfillment of its commitment to protect workers through its investment in tea plantations in the State. As per a report issued by Human Rights Watch, the NGOs delivered a petition to the International Finance Corporation (IFC), the World Bank’s private sector arm, for urgent remedy of the situation.  

The Inter-American Development Bank (IDB) describes itself as a champion of integrity and transparency, working with its Latin American and the Caribbean member countries to strengthen governance and rule of law at local and national levels. As a public institution committed to sustainable development, it has endorsed the principle that “environmental issues are best handled with the participation of all concerned citizens.” However, as the residents of Fontibón, a neighborhood in Bogotá, Colombia, recently learned, the bank does not universally apply these standards to its own activities.

The idea that nonprofits should develop a theory of change has been widely embraced in recent years, and funders have helped drive the momentum. In fact, many funders now require that nonprofits submit a theory of change document with grant requests for all the reasons Paul Brest outlined in his seminal article, “The Power of Theories of Change.”

It has been six years since the United Nations published its first set of corporate governance standards aimed at curbing human rights abuses in international supply chains. On Sept. 21, the U.N. Global Compact Leaders Summit in New York, bringing together leaders from government, business and civil society, will assess what progress has been made.

This month marks the 10th anniversary of the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP). This landmark international document, though imperfect, contains important provisions for countries to protect the right of Indigenous Peoples to freely pursue their economic, social, and cultural development.