Samuel Dash Conference on Human Rights, Georgetown University Law Center
The substance of lending safeguards
Nadejda Atayeva, President of the Association for Human Rights in Central Asia
Leonardo Crippa, Senior Attorney, Indian Law Resource Center
Jessica Evans, Senior Researcher/Advocate on IFIs, Human Rights Watch
Dr Bharat Patel, General Secretary, Machimar Adhikar Sangharsh Sangatan (MASS)
Moderator: Ian Kysel, Dash/Muse fellow with Georgetown Law Human Rights Institute
Atayeva
- WB loans to agricultural sector in Uzbekistan
- Farms privatised, independently decide what to do with land, what crops, and what price, etc
- Every year mandatory requirement from government on cotton, punishment if failure to comply
- Government price from government, farmers not benefiting or enough to pay labourers
- Each year Sept and Oct, students etc working to reduce price of labour
- All farms bound by state system
- Laws passed against forced labour, but not enforced
- Directors of schools, hospitals etc must report directly to administration
- Forced to sign non disclosure statements
- Payment extracted from farmers
- WB must not fund projects where forced labour and child labour is used
- 2013 WB acknowledged in writing that the system could not ensure no forced and child labour, but still went ahead
- CSO activists gets persecuted, 300 in the last 8 years, limited freedom of movement
- My organisation and others submitted complaint to the Inspection Panel, visited Uzbekistan Dec 2013, found evidence children under 13 working, and forced labour – improper due diligence
- Given Uzbekistan one year to address child labour in the project
- Recommendations, including implement policies to forbid any investment in projects with risk of child labour
Patel
- Ecological degradation and social economic violations, and livelihoods violations in the Kutch area in Gujarat, India
- Known for rich biodiversity
- Traditional fishing, 8-9 months a year families comes to stay by the coast, but no roads, schools, public heath centres
- Tata Mundra, largest power project in India, special economic zone
- Other form of disaster from the earth quake in 90s
- 22,000 MW capacities, five mega ports
- IFC funding Tata Mundra 2008, 4,000 coal fired plant near Mundra Port, first ultra mega power project
- Imported coal from Indonesia, shipped to port
- Also ADB funding, Korean ECAs and local banks
- Didn’t look into social and env impacts, including for the fisher folks, farmers, pastoralists
- Between Tata and other plants, water channel that should have been closed cooling system, now open
- Chlorine etc damaging the fish, forcing fishers further into the sea
- Traditional way of fishing threatened
- Ground water depleted, source for people living on the coast, also horticulture
- Going for immigrated labour, lots of consumption of alcohol, domestic violence
- Fact finding team, found 20% increase in health hazards – both humans and fish
- IFC failed to independently check the company’s impact assessment
- Risky to approach CAO, as WB institution, but report reaffirmed concerns
- IFC hasn’t submitted to the facts, even president Kim has been silent, going along with IFC, even though people have not benefited as in the CAO report
- Demands from communities, recognising serious policy violations, need action plan with specific timeline, restoration and reparation needs, withdraw funding
- Local movement, but now also global, in DC
Crippa
- Legal issues, indigenous peoples policies
- History, WB created 1944 Bretton Woods conference, 8 years before first HR instrument, universal declaration of HR
- State obligation to protect people, and to redress violations
- Labour rights and rights of child, ILO created 1917
- With international law, does it has the capacity to create treaties and agreements on international level, and inst need to have privileges and immunities from national jurisdictions – WB complies
- Almost every day countries signing agreements with MDBs
- Guatemala Chixoy, can’t sue the WB despite massacre, no justice – issue of human rights
- WB articles of agreement is a treaty, have own lawyers to interpret the treaty
- 1980’s WB forced to create safeguard policies – no internal agency that would seek compliance, supervising – 1990s creating Inspection Panel
- So internal policy frameworks created by the Bank, now reviewing
- Inspection Panel, esp land administration comes up clearly with HR – affecting the heart of indigenous peoples, allows survive as a people
- Indigenous Peoples policy OP 4.10, WB people will say rights based policy, trying to protect indigenous peoples
- Some language that may speak about HR, esp indigenous peoples, but not asked to do human rights impact assessments
- WB should start working for the poorest of the poor indigenous peoples, but also to exercise self determination and self government
- Highlight shortcomings in OP, nothing of this in it
- Collective ownership over lands and resources important, nothing on land tenure
- Law guarantees must apply, but with indigenous peoples, FPIC, but legal standards need due process of law
Evans
- Lot of HR violations we’ve investigated over past few years have implicated the WB
- Env and social policies has to comply with env law, but not HR
- At discretion of WB staff members
- Ethiopia, 2009 two laws, anti-terrorism and CSO law – in practice crushed CSOs, journalists imprisoned
- WB providing basic services, incl agr ext work, watsan, transport, food, health and education – but in practice people denied, used as a political tool
- Villagisation programme, Gambella region done in very forced way, including killings, torture, sexual violence – WB not funding, but basic services that the gov was going to provide in the villages, but few opportunities in the new villages
- In practice many people tried to go back
- WB responded by doing a desk study on tools to identify discrimination, but needed field investigation, but never happened
- Dialogue died down on the problems
- Safeguards review, might include some kind of prohibition of discrimination, but need to be in line with international law
- No analysis of env for CSOs, and people affected by the programmes
- Forced evictions and displacement with extreme violations, WB responding not enough evidence
- HR due diligence needed
- WB determined safeguards doesn’t apply to investment lending where budget support is large part of it
- Vietnam WB financed health programmes in drug detention centres
- People forced to work, if not punished in extreme cases torture
- WB didn’t acknowledge HR violations, WB said did not receive complaints
- Marginalised people in a country with degree of repression, how could they complain to WB
- 90% disbursed when HRW complaint presented to WB
- Tanzania, sustainable mining programme by WB, good env impact assessment including identifying mercury use on environment, but not on health
- Child labour identified, missed HR and development issue
- Also in Uganda programme
- HR not ignored in every case, president Kim publically acknowledged discrimination and development links
- Uganda health project, risks of people being excluded due to sexual orientation or identity – WB required confirmation, positive example
- Concern not systematic requirement
- WB should respect HR, not finance projects that contribute to or acerbate HR
- HR due diligence, integrate HR analysis into env and social impact assessment
- Safeguards should meet international human rights standards
- Apply safeguard policies to all activities
- Enhance implementation, monitoring and supervision
Q&A
Kysel: What is achievable at WB
Evans
- WB restructuring distracting
- What is achievable, prohibition on discrimination – need to ensure is consistent with int standards
- US congress played an important role in reforming WB
- Possible integrate element of HR due diligence in soc & env, unlikely stand alone
Crippa
- Most of senior staff has left the WB, new people are coming in – don’t know what the new model will look like
- Hope some sort of working group is possible, including people outside the WB
- IFC performance standards review advisory panel, representatives of clients, lawyers, unique space to discuss how to move forward – but not enough as not part of IFC performance standards
Atayeva
- In countries like Uzbekistan, also speaking on behalf of people still fighting for freedom, including in prison
- Important to work with the information from people in the country
Patel
- What about the communities, no information to them
- Private sector double speak, creating desperation in the communities, who makes sure they benefit
- Growing alcoholism, in relation to migrant labourers, cascades into domestic violence – how HR could look at causal change
Q: Stance on why WB isn’t more proactive in HR?
Q: Monitoring and supervision, what steps could the WB do to improve HR?
Q: 10,000 fishermen in India, is this important enough to understand what is happening in India, should the example be about more people to be more representative? IFIs are motivated by profit too, how to accommodate this with political aspects, eg in Syria?
Patel
- It’s not about the numbers, 10,000 doesn’t seem to be enough – I am part of the people impacted
- HR one man counts, 10,000 huge – these are fishermen, also pastoralists, farmers, labourers
- Not about numbers, about intensity of it
- Since earth quake displacement, now much more, WB sees not removing poverty but you are removing the poor – much more intense
- Demanding direct funding of monitoring, layer in between of clientele, demand stringent form of due diligence
Evans
- WB primarily economists, HR strange language not familiar with
- Nordic trust fund work to raise awareness, but long way to go
- Incentive structure problematic, getting money out of the door, projects approved
- Problem of monitoring when focus on getting approval
- Syria, etc, spec rapporteur on HR did work on profits in work on HR, cost of delays due to opposition of communities expensive, Ernst & Young research confirms
- Extreme HR situations, how to provide development to people is outside the WB’s capabilities – about third parties, and put pressure on government for access, but funding these goverments very problematic
Crippa
- Institution with internal divisions, but outside of WB at the UN, time to address this issue and develop statement on how to address HR in development work
- Relevant as can talk about the WB as UN specialised agency, eg in working group on business & human rights, but need standardised mechanism to address IFIs like WB
Atayeva
- Uzbekistan, WB consultants are always accompanied by WB representatives
- Made to tell what the government wants the WB to think, need independent monitor
Independent and robust oversight mechanisms
Richard Bissel, Executive Director of the National Academy of Sciences Division on Policy and Global Affairs
Kristen Genovese, Researcher, Center for Research on Multinational Corporations
Meg Taylor, Vice President, CAO
Moderator: Professor Edith Brown Weiss, Georgetown University Law Center (former Chairperson of the Inspection Panel)
Bissel
- Many assume WB first multilateral to implement safeguards, greatest innovation not within WB – conservative
- Expansion of mandate of Inspection Panel
- Discussed before to include IFC, but CAO set up instead
- Also expansion into human rights, creating early stages in IP procedures, going into post decision monitoring
- Panel fact finding mandate, not engaging in astute resolutions
- Would involve reopening the resolution of IP
- Have to do with politics, board has been subdivided in 50/50 – decision could come up with doing it away with altogether
- Access issues, big window, so people see no barriers to complaints – could that improve the Panel
- EIB open system, can come with complaint without any knowledge of policies at all – user friendly
- Scope of remedies, compensation – limiting factor, to the body under which it works
- WB not providing as a matter of practice
- IP created by board of directors, advising, fact finding
- IP to develop compensation when overall WB is not, is mixing up concept – need to look at the overlying institution re precedence
- Reinforcing the mandate of the institution, independence
- Independence in practice, fundamental to the robustness of the institution
- Once complaint received belongs to the Panel, not the complaints or management
- Independence in approach – determined by members of IP, experts appointed due to independent judgement
- Independence in procedure, investigatory process – access to all information, includes a monitoring function independently
- Implementation, human rights cause great anxiety, not WB management but shareholding governments – may be signed on to int conventions on human rights, but don’t want it tied to specific loans and don’t want supernational entity telling them
- Right based approach huge political issue
- AfDB includes language on HR in new policies, rights based, ties with labour standards, rights of child etc – lot of language to keep an eye on
- UNDP new standard, HR language included, better embedded than in the Bank
Taylor
- I came to in 1999 when the TOR was given to me
- Private sector side of WBG, addresses cases filed by communities, individuals, groups – provide accountability, grievance redress mechanisms
- Doesn’t report to the board as IP, but some cases board intervention, in part around compliance cases eg Dinant
- Dispute resolution, providing remedy,
- Compliance, IFC/MIGA performance
- Advisory, looking at systemic concerns
- Board pushing for lessons learned
- 48 active cases in 19 countries
- Most LAC cases, but increase in Asia
- 48% extractives, infrastructure 20%
- Resource intensity land/water, agribusiness likely to increase from 13%
- Project due diligence, disclosure, socio economic benefits in relation to risk, pollution, resettlement, water security, indigenous peoples
- IFC policy framework, 8 performance standards plus disclosure policy
- Responsibility towards clients, what is the institutional responsibility?
- IFC and human rights, responsibility in part regards to gaining access to redress
- Eg PS 2 labour and working conditions – fundamental rights of workers
- PS 4 Community health safety and security – important for Dinant audit findings
- PS 7 indigenous peoples – strong position on FPIC, but no case yet
- Looks good on paper, but implementation and what happens on the ground key
- 60% of complaints since 200 are written in HR language
- Important bar to getting a project to CAO is deliberately low
- Discussed as institution is too low, but agreed to ensure access to remedy – without knowing anything about the policies, CAO team will work out where it fits in
- CAO monitoring function, monitor the agreements and report on
- Dinant, Honduras, case – Wilmar palm oil in Indonesia led to institutional response and strategy on palm oil, Tata Mundra, two other cases with big impacts on IFC
- Dinant came through letter to former WB president, about what IFC didn’t do – blew the lid on IFC, findings were tough, violence, death etc
- WB board got directly involved to get robust response, CSOs have been involved in this, thankful for this
Genovese
- Inspection Panel created 20 yrs ago, 1993, communities for the first time reaching higher levels in WB
- Since other MDBs, and some bilateral and finance inst have created similar mechanisms
- January newest one, joint by Dutch and German development banks
- Together forms the independent accountability mechanisms, meets once a year
- Without these mechanisms thousands of communities will be worse off
- But no way to stop projects that causes or violates HR abuses, need to get people out on the streets, putting themselves in danger, to do so
- Guatemala mine on indigenous territories without consent, still operating and expanding – no way to stop it
- Failure of the WB management within accountability system
- Too easy to look at the mechanisms to say they are not doing a good job, but WB management at fault
- Tools available, mediation – bring communities and clients together, have seen concrete outcomes, but not suitable for all conflicts, what to do when it doesn’t work, takes time to get it right, how to ensure communities don’t settle for less than they deserve
- Client is doing all the work, IFC may not be involved
- Compliance – against what standards, if no HR it is limited, reliance on WB to respond to the findings
- Management are not taking the findings seriously
- Learning from failure? Statement by Kim, but we are seeing WB refuting or denying the findings, eg Uzbekistan, Tata Mundra
- Eskom case, South Africa, eg impact on water sources – Panel found WB not doing robust assessment, WB in response said disagreed with the findings and refused to come up with an action plan
- A year later Eskom asked gov for concession as not enough water resources
- Financial intermediaries, CAO research shows IFC doesn’t know the impact
- IFC response in action plan says failure to communicate the benefits – ie failure in PR
- Board intervention to ask IFC to revise action plan
- What do we need, no measure will be easy – dynamics at the board difficult
- See paper by Herz and Perrault on when IP can address human rights
- Concern about IP, don’t know what happens after report
- Need increased role for complainants, only after board decision will they see the Panel’s report – can see a role for complainants during board decision
- Mandate to weak
Brown Weiss
- the role of fact finding, why the change at the Panel now?
Genovese
- new board members with no institutional memory of the value of IP and why it was created
- new strategy for WB to take more risks
- going back in time, eg large hydro
Bissel
- Turnover factor a huge problem
- Incentives and pressure from borrowers
- Recent IEG studies on success rate of WB projects, causing turmoil at the board level
- Safeguard policies reform, targets keep changing
Taylor
- Greater control of the budget would help
- CAO reports to the president, but president also a chair of the Board
- In charge of the budget, but comes from IFC and MIGA
- Lots of new cases coming in this year, budget excruciating experience, at the point where we couldn’t function
- Also impacted by personalities of executive vice presidents
- Accountability function is very important, how to manage risk factors to your business
- If you don’t look at env and social for transformational project
- confidence of budgetary support, first time this has happened
- issue for WB need to be big budget cuts, huge number of cases coming through – if this is the trend need to have understanding that acc functions need to be resources to be able to respond
Q: Need for systemic change now, as per Meg’s comment
Taylor
- We’ve got the best of people working for us, if we can’t make a difference now, why?
- Indications from senior management, lack of acknowledgement of accountability function – this is the time to take on the fight
- Emphasis on transformational investments
- IFC people talk about cost to the institutions, we talk about the costs to the people, communities
Q: Reprisals to communities filing complaints?
Bissell
- promising confidentiality, also cases where didn’t ask for confidentiality, but experienced threat from communities
- communities can be afraid to come forward on their own
- only finding the extent of the problem when going to the field
- interested in grass root remedial mechanisms
Brown Weiss
- in a couple of cases need to ensure it doesn’t continue
Q: Restructuring at the WB, some people being pressured to get jobs in different parts in WB – do you think the same people with same thinking will remain.
Brown Weiss
- not quite right for this panel to respond to
Q: Cases written in the language in human rights, comment?
Genovese
- important for policies to include language on human rights, linked to international law
Q: What opportunities to use the WB to influence eg the BRICS bank? Financial markets work?
Taylor
- financial markets work, on-lending to sub clients, which is where the weakness is
- some also goes into funds and private equity, will be some announcement this week on IFC’s involvement in funds
- due diligence is required
Genovese
- Dinant case, very serious situation on the ground, but not new
- After direct investment, IFC made investment in commercial bank that then invested in Dinant
Taylor
- full investigation into the bank now, wait for the full report
- WB, IFC needs to be convinced on their own role first, strong leadership from president Kim, but influence from various on the board
Bissel
- there is a backlash on the role of the accountability mechanisms
What shapes how multilateral development banks promote human rights?
Caio Borges, Attorney, Business and Human Rights Program, Conectas Direitos Humanos
Mac Darrow, Chief of the Millennium Development Goals Section, UNHCR (in personal capacity)
Siobhan McInerney-Lankford, Senior Counsel, World Bank LEGAM (in personal capacity)
Moderator: Professor Alvaro Sangos, Georgetown University Law Center
Darrow
- How MDBs can be influenced, role of UN seems humble, but some areas where UN and WB interaction has been significant
- Set up to work in harmony, but WB keen to exercise independence – eg more complicated decision making structure
- Human rights system, global level process on business and human rights, including IFC, to develop guiding principles
- Market for project finance substantial, if HR due diligence taken into account could give big rewards
- Dinant Honduras case, if more alertness on role of HR mechanisms, some of the HR risk factors could have been picked up earlier
- 1990s discussion MDB resources could be used to reinforce commitment to human rights in member states
- Big dams disasters, structural adjustments
- Emerging desperations coming into findings of accountability mechanisms, increasingly looking for systemic issues impeding performance across the board
- Another case, Cambodia ADB case loan to rejuvenate railway line, including displacement – non compliance almost across the board
- Replication of a highway project in the same country, also replication of similar project in Sri Lanka – learning loop not closed
- Pyramid of causal factors, at base political/geopolitical constraints
- Middle area organisational disincentives, including epistemic challenges
- Top capacity constraints, not a lot of human rights trained people at WB
- Human rights safeguards – UN as system where human rights treaty and others are developed, can be conceived as safeguards, do no harm, can be defended under international law
- Broad discretion on how safeguards policies are implemented, boundaries need to shift on duties on MDBs in general
- HR criteria could easily be implemented into existing safeguards, without stand alone safeguard
- HR part of risk management system
- Threats, reprisals, harassment of people bringing HR issues forward
- MDBs taking sides by being there, providing loans etc
- Strategy, eg look at debt relief campaign – need to be an issue that captures the imagination
- Need to account for epistemic constraints, institutions dominated by particular constraints of macroeconomic thinking
- Social capital, gender and development studies, can be opportunity costs by shoe horning an agenda into a paradigm
McInerney-Lankford
- working on HR for a number of years
- who would impose HR, who by and who on
- the need to educate staff
- 1945 Bank articles, everything the Bank does has to advance the Bank’s purposes – no mention of human rights, also not of poverty and new twin goals
- political prohibitions in articles, clear and old fashioned
- subject to interpretation over time, would be room for HR consideration if economic impl
- WB promotes HR, supports realisation of HR, but no project HR as goal
- Policy framework, supportive of HR, but no explicit policy
- IFC’s sustainability policies, performance standards – may be room to integrate HR more
- Ref to HR are accompanied with business, not freestanding ref to HR
- But important developments, provision of HR due diligence
- WB own safeguards review on-going, discussion in and outside WB
- HR was discussed as emerging issue, anyone’s guess how it will play out
- WB and HR opportunities: partnerships, informal engagement with UN, OECD and others, OECD DAC task team including aid effectiveness and human rights
- Informal UN level discussions
- WB sector level discussions eg on water, research on HR in relation to conflict, fragility, HR impact assessment
- Nordic Trust Fund, would not promote a rights based approach, but assess in the context of country based priorities, bring HR lens to this
- Modalities analytical work and research
- The informed view – elements of how the WB’s work is shaped, country engagement is critical to success, importance of evidence, relevance of members own obligations, value of institutional cooperation, need for clarity around the uses of the language of HR, convergence on HR principles
Borges
- BRICS development bank, Stiglitz and Stern paper on push for Southern infrastructure fund at BRICS third summit
- Fifth BRICS meeting in South Africa, declaration on BRICS bank, aimed at infrastructure
- What would a BRICS bank look like? Providing funds, GHG emission reduction etc etc
- But also sceptical view, eg Rodrik – should not mimic existing international institutions
- Preliminary study: Comparative analysis of BRICS national development banks social and environmental safeguards, also on transparency and access to information – only two disclose social and env impact assessment
- What to learn from BNDES?
- Some say will build on national development banks
- BNDES last year USD85 billion in loans
- Human rights in BNDES, one entry in annual report, no mention of indigenous peoples
- BNDES restricted mandate, sees itself as exporter of goods and services
- No safeguards, national sovereignty
- Low transparency standards, no disclosure of E&S reports
- BNDES ombudsman, name not made public
- Approx. 2400 cases in 2012, mainly small entrepreneurs queries
- No transparency, statistics, procedures, cases, outcomes
- Political economy of a new MDB – no legal document, articles of agreement etc
- Have to wait for voting structure, governance structure etc
- Guided by national experiences, but not necessarily a reproduction
- Building on old model?
- What role for civil society in BRICS countries – not invited to the table
Santos
- implications for strategy, eg given bias towards particular type of economic thought?
- Legal mandate, in 90s thought WB should be able to ask states to change?
- BRICS bank, how are fears of race to the bottom justified?
Darrow
- theory of rational choice, social capital to counters some of this
- results of this in studies not encouraging
- documentation by Stern and Ferrero in WB
- gender and environment experience of mainstreaming, but if running counter to dominant world views, can’t expect too much
- don’t present HR as a new paradigm, look at value and legal based discipline, as do no harm, your safeguards
- gets around a little bit the questions of value added – it’s a compliance questions
- doesn’t displace the need for positive engagement, when change happens in institutions its often externally driven
- be alert to the risks, a lot of gender discourse has been minimised by contextualising, eg looking at impact at growth rather than value based
McIverney
- difficult to make distinction water tight
- important to recognise political context of any intervention
- great deal to be said for an institutions that tries to be neutral, based on non political factors
- maybe look at political prohibitions in a current context
Borges
- domestic realities, eg big infrastructure despite local resistance
- could HR discourse accommodate or wait for other political discourse or event to change
Q&A
Q: Neutrality, if it means not taking sides, how to deal with it?
Q: Cambodia railway case, in draft report from compliance review panel, recommendation for ADB to set up fund for remedial compensation. Always up to the borrower to pick up the remedy, how can the WB claim to be accountable?
McIverney
- Neutrality, risk of government implicitly – aspiration of institution, established at WB
- Don’t think institution designed to tackle this, articles old-fashioned
- Trying to have neutral stance
- Accountability, had Inspection Panel when many had not
- Don’t agree WB never takes responsibility
- HR perspective not all or nothing discussion, concepts like core minimum helped to translate concept like trade offs
Q: Multilateral donor organisations, but there are also countries that investing developing countries on their own, eg bilateral donations from China to Nigeria
Q: BNDES and why we’re not learning or unlearning. The scramble for business, is this a trend, how does it fit into strategy discussions?
Darrow
- Actively changing donor landscapes
- EU world’s largest bilateral donor
- Difficult to generalised, future prospects are complicated
- Leverage often a get out of jail card, but in detail it is country specific
- If in mix of inelegant scramble for business not encouraging
Q: Has WB vice presidency moved since Danino, or regressed on HR? Need for instrumental argument in relation to do no harm approach
Q: Financing of political movements incl Saudi Arabia, with no HR approach
McIverney
- Hard to characterise mood of whole legal department
- Home of HR was in legal dept at that time
- Not comfortable characterising whole vice presidency
- Power of do no harm in normative force, could reduce relevance for instrumental reasons, but could say do no harm