The International Finance Corporation, the private sector arm of the World Bank, has released a new policy to govern how it responds when projects go wrong and seriously harm people or the environment, but advocates lambasted its “shocking” failure to go far enough or address past problems.
The new draft, Approach to Remedial Action, will guide how IFC and MIGA, or the Multilateral Investment Guarantee Agency, compensate communities when projects they have invested in cause environmental destruction, health problems, or human rights violations, among other issues.
The new guidelines provide some clarity on how IFC will avoid problems, help resolve complaints, and increase leverage on clients to make sure they pay when things go wrong. But it does not guarantee compensation from its own coffers.
About the author
Adva Saldinger@AdvaSal
Adva Saldinger is a Senior Reporter at Devex where she covers development finance, as well as U.S. foreign aid policy. Adva explores the role the private sector and private capital play in development and authors the weekly Devex Invested newsletter bringing the latest news on the role of business and finance in addressing global challenges. A journalist with more than 10 years of experience, she has worked at several newspapers in the U.S. and lived in both Ghana and South Africa.
