Call for IFC performance standards delay to strengthen rights

News|Bretton Woods Project|30 September 2010|update 72|url
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Civil society organisations are calling for the extension of the schedule of the International Finance Corporation’s (IFC, the Bank’s private sector arm) consultation on its performance standards (see Update 67) to allow opportunity for human rights and other controversial issues such as climate to be incorporated.

They believe a delay could lead the IFC to more adequately adopt the principle of free, prior and informed consent (FPIC) and take on board the recommendations of John Ruggie, the UN special representative on human rights and business (see Update 71).

US civil society organisations have seen the likely endorsement by the US and Canadian governments of the UN Declaration on the Rights of Indigenous Peoples as an opportunity to put pressure on the IFC to adopt the principle of FPIC. With the US and Canada on board, FPIC would become a near universal standard.

While Canada’s endorsement is imminent it may be up to four months before the US ratifies the declaration. With the performance standards due to go to the Bank's board committee on development effectiveness for approval in mid October, NGOs have been pushing for a delay in the process until after this has happened.

Many of the comments in the recent round of submissions for phase two of the performance standards consultation highlight the failure to take on Ruggie’s recommendations, including on proper due diligence and tracking and reporting of performance. Although the first draft acknowledges Ruggie’s framework, a letter from the Equator Principles Financial Institutions (EPFIs), a group of financial companies, highlights the fact that the timing of the Ruggie mandate and the IFC review process are not fully aligned. Ruggie is due to issue his next report in 2011, after the review has already gone to the Bank’s board, leading to rumours that the review could be extended by up to six months.

NGO Amnesty International argues that the “IFC’s conclusion that all relevant civil, political, economic, social and cultural rights are ‘well addressed’ in the sustainability framework is not credible.”

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Published: 30 September 2010 , last edited: 18 October 2010

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