This page is part of the E3G Public Bank Climate Tracker Matrix, our tool to help you assess the Paris alignment of public banks, MDBs and DFIs.
|Some progress||Transparency of financial intermediary lending needs improving.|
|Climate finance data||Provides adequate data to the OECD and published 2018 underlying project level data for the Joint Report on Multilateral Development Banks’ Climate Finance and in PDF format.|
|Financial intermediary lending||Environmental assessments of high-risk sub-projects published|
Transparency of climate finance data
The World Bank has provided the project level data underlying its submission to the MDB joint report in PDF format for 2018 only. The release in PDF format makes it difficult to do in depth analysis. The World Bank provides an adequate level of information in its submission to the OECD-DAC (Development Assistance Committee) climate-related development finance database.
Transparency of financial intermediary lending
Oxfam, who have done studies on the transparency of financial intermediary (FI) lending found the Bank’s 2013 operational procedure stated it would disclose the summary of the Environmental and Social Impact Assessment of sub-projects considered high risk (Category FI-1 and FI-2), but also found IBRD/IDA seemed to disclose full reports of impact assessments, mitigation, and resettlement plans.
In September, the IFC unveiled its new approach to greening equity investments in financial institutions. The IFC says it will end equity investments in financial institutions that do not have a plan to phase out investments in coal-related activities. The “30 by 30 Zero Program” aims to help the banking sector increase climate-related lending to 30 percent and reduce their exposure to coal related projects to zero by 2030.
The newer Environmental and Social Framework states the FI will submit the “environmental and social performance of its portfolio of FI subprojects. The annual report will include details of how the requirements of this Environmental and Social Framework are being met, the nature of the FI subprojects financed through the project, and the overall portfolio risk, profiled by sector”. This appears to suggest that the sub-projects will now be aggregated upon disclosure.
Recommendation: We recommend that all public development banks consider disclosing their operations against a version of the EU Sustainable Finance Taxonomy that has been adapted for the region the bank operates in. This is because it is science based and is reviewed regularly to reflect changes in technology and science.