The International Finance Corporation, the World Bank’s private sector arm, has released a new policy on how it exits investments; guidelines civil society organizations have sought for years to ensure the organization does not leave communities in the lurch when it leaves a project.
Exiting is a natural part of the investment cycle, but the timing and manner of the IFC exit can have a significant bearing on the potential impact of a project, including the resolution of any environmental or social problems that arise. IFC has come under scrutiny in the past for exiting investments after complaints were filed, seeming to shirk responsibility, and then claiming it no longer had leverage over the project, civil society organizations said.
There are dozens of examples through the years where IFC has left people in a bind, including cases under investigation or in dispute resolution processes at the Compliance Advisor Ombudsman, or CAO, said Carla García Zendejas, director of people, land and resources at the Center for International Environmental Law.
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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.
