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The Equator Principles: Global Accountability & Future Developments

Dive into the history, impact, and potential future of the Equator Principles - a benchmark for responsible project financing. Explore the challenges, improvements, and threats faced by this global initiative. Discover the role of private sector in globalization and the need for transparency and compliance mechanisms.

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The Equator Principles: Global Accountability & Future Developments

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  1. Global Accountability The Equator Principles Will they further develop? ‘Growth, Conservation and Responsibility’ Seoul, 27th Annual Conference IAIA 3-9 June 2007 Maartje van Putten

  2. History of the Equator Principles • Private banks follow Chad-Cameroon. • 4 July 2003 10 banks, at present 51 • IFC as the model or pressure of NGOs? • Serious Stewardship or just PR? • What is it and how will it evolve?

  3. The Principles a Global Benchmark? • Globalization: Strong role private sector • Loss of the factor State? • FDI: 91% private sector 9% Public money • Stronger than any other code of conduct • Very promising IF implemented

  4. Equator II an Improvement • Early Community Participation with affected communities • Stronger social and environmental Standards: child labor • Grievance Mechanism and Independent Review of assessment • Periodic Reporting • EPs apply to all new project financings (>10 Million $) • Upgrades existing facilities • Also project finance advisory

  5. Still missing in the Principles • EPs do not apply to High-Income OECD countries • Do not apply to corporate loans, debt and security underwriting • Not yet: Problem Solving and Compliance review Mechanism as MFI’s have • Transparency in implementation weak

  6. Structure of EPFIs • Principles are voluntary • EPFI’s have common website/secretariat • There are not yet clear ‘Club-rules’. • Fear for anti-trust rules.

  7. Threats to the Principles? • Weakening of the Standards by EPFI’s • Lack of Transparency criticism of NGO’s • A scandal of ONE EPFI affecting group • Competition with non-EPFI’s > China, India a.o. • Quality assurance

  8. Concluding Remarks • Globalization: Private Sector is taking over from Public Sector • Legal Liability is on its way • Invest in Chinese, Indian etc. Private Financial Institutions > adopt Principles • Create an Independent Problem Solving and Compliance Review Mechanism

  9. Of coursetheycanparticipate as soon as our planning is over Global Accountability The Netherlands Tel. +31-651111553 How do we getthere?

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