| Paris alignment | Reasoning |
|---|---|
| Some progress | The WBG provides data to reporting initiatives and databases, such as the OECD-DAC climate-related development finance database, and the MDB joint report on climate finance. However, the data provided are mostly in aggregate form, and not in Excel-readable format, making analysis difficult. Moreover, the Bank Group could improve its TCFD reporting, in particular on its risk management disclosures, and on data from aggregated and portfolio-level risk analysis. |
| Climate Finance Data | Disclosure of climate finance data across the WBG is limited to aggregated results across their reports and website. Although it is possible to identify project level climate finance shares in individual project documents, this data is not very accessible and is not in a machine-readable format. Despite this, the WBG and IFC provide adequate project level data to the OECD, although IFC’s submission lacks sectoral tags for its projects across several submissions. |
| Financial intermediary lending | The WB’s Environmental and Social Standards state that the Environmental and Management System (ESMS) in place for projects financed through financial intermediaries must be summarised and disclosed on the Bank’s website. IFC is the top-performing DFI in providing information on its FI lending according to the 2023 DFI non-sovereign Transparency Index. |
| TCFD Reporting | While both IBRD & IDA and IFC conduct TCFD reporting, the content of the reports is lacking in terms of risk management disclosures, and updates on metrics and targets (including portfolio level climate risk and high-risk sector exposure data). |
Explanation
Transparency of climate finance data
The WB is ranked fourth for its disclosure of sovereign operations in the DFI Transparency Index 2023, out of a total of nine MDBs assessed. The Bank has disclosed its economic, environmental and social portfolio level impact data to the Global Reporting Initiative Index since 2008, and the CDP (Carbon Disclosure Project) since 2009. As of 2023, the WBG summarises aggregate annual climate finance data in the form of a fact sheet on its website. A breakdown of IBRD and IDA portfolio level climate finance is also made available through the WB Annual Report Appendixes. The WB has only provided the project level data underlying its submission to the MDB Joint Report on Climate Finance once, in 2018, and has not done so since.
Notably, a 2022 report from Oxfam on the WB’s climate finance reporting noted there is currently no way for the public to verify or fully audit the Bank’s climate finance and progress in relation to its targets. The report notes that the WBG’s application of its climate finance accounting and reporting methodology is lacking. It points to the calculation of climate components of projects not typically being accessible and often embedded in long narrative documents, and the climate finance data provided to the public lacking granularity. Oxfam’s analysis indicates that the WB may have overestimated (or underreported) its climate finance levels by as much as 40.8% in 2020.
There therefore remains room for improvement for the WB to provide reliable, detailed climate finance data.
Additionally, a 2024 Recourse report showed evidence of climate finance from the WBG and other MDBs funding fossil fuels and highly polluting projects while failing to prioritise the most climate-vulnerable countries.
IFC is ranked first by the DFI Transparency Index 2023 on disclosure in non-sovereign operations. However, despite strong performance relative to peer institutions, it ultimately only scored 54.4 out of 100 overall due to a lack of project level indicators in its submissions, including activity indicators, metrics, and results. More generally, IFC did not release the data behind its submission to the 2023 Joint MDB Report on Climate Finance. The WB and IFC did, however, provide adequate information in their submission to the OECD-DAC (Development Assistance Committee)’s climate-related development finance database, although IFC’s data lacks sectoral tags for its projects in several of its annual submissions.
Transparency of financial intermediary lending
Since 2016, the WB has required its financial intermediary (FI) clients to disclose and allow the Bank to publish a summary of each of the elements of their Environmental and Social Management System (ESMS). However, it is not clear where on the WB’s website this information is made public.
IFC topped the FI sub-investments component of the DFI non-sovereign Transparency Index in 2023. IFC is the only DFI assessed by the index to have disclosed the identity of FI sub-investments from Bank assessments, and to have clearly defined sectors of activity for on-lending activities. Despite this, IFC’s access to information policy does not currently commit to consistently providing detailed financial information (or define the boundaries of the release of information) of investments through blended finance and FIs. Nonetheless, the Bank Group’s Environmental and Social Framework states that all organisations under the WBG will require FIs to submit “environmental and social performance of its portfolio of FI sub-projects”. The ESS specifies annual reports should include information on how such requirements are met, suggesting that subprojects would be aggregated upon disclosure.
Beyond these formal disclosure requirements, in 2018 IFC notably piloted further voluntary disclosure of high-risk subprojects from FI clients. This was later extended to subprojects in Category A or B in March 2020.1 It is unclear if this is still ongoing. The disclosure covered new equity investments in commercial banks, including with existing clients, and new senior bonds issued by commercial banks.
TCFD reporting
1 Category A&B projects are business activities deemed to have potential significance or limited adverse environmental or social risks and/or impacts. More details on IFC’s website here.