Individuals and communities who endured the negative effects of publicly financed development projects had few, if any, paths for recourse until the World Bank Board established its Inspection Panel in 1993. This example led to an eventual proliferation of independent accountability mechanisms at other development finance institutions. These mechanisms aim to give voice to project-affected people’s grievances and help enforce the so-called “safeguards” policies of the institutions, which promise to “do no harm” to people or the environment. Despite this progress, three decades after the establishment of the Inspection Panel, the right to redress—a core element of the right to effective remedy for human rights violations under international law—remains elusive for many affected communities.
Even when investigations carried out by the accountability mechanisms conclude that harm has been caused as a result of non-compliance with institutional policies, there are no guarantees in place to ensure redress. Without such guarantees, including effective remediation mechanisms with adequate financing, those whose rights have been violated must rely on the goodwill of the management and boards of these institutions, as well as the cooperation of client governments and/or companies, to take appropriate remedial action. Such goodwill and cooperation is rarely forthcoming.
For over a decade, Inclusive Development International has worked alongside civil society partners from around the world to close this accountability gap and advance the right to effective remedy for people who are harmed as a result of development and corporate malfeasance.
In February 2023, the two private sector arms of the World Bank Group, the International Finance Corporation (IFC) and Multilateral Investment Guarantee Agency (MIGA), published a draft Approach to Remedial Action, a proposed framework to remedy harm stemming from development projects they have financed, and to prevent future harm from occurring. While we welcomed the arrival of a remedy policy framework at the World Bank Group after so many years of demanding it, we were deeply disappointed that the proposal was vague, noncommittal, and piecemeal.
We submitted comments on IFC/MIGA’s draft, urging the World Bank Group’s members to significantly strengthen the proposal. Drawing on our work with affected communities in Guinea, Cambodia, Indonesia, the Philippines and elsewhere, we made extensive recommendations for how the IFC and MIGA can guarantee the right to redress for harms arising from their investments, including by:
During the public consultation period following IFC/MIGA’s publication of their draft approach to remedy, Inclusive Development International also joined with many other civil society organizations and advocates for communities affected by IFC and MIGA-backed projects to demand a much more comprehensive and systematic remedy approach in line with international standards for human rights and responsible business conduct.
The proposed remedy framework released in 2023 was among the outcomes from an external review of IFC and MIGA’s Environmental and Social Accountability, which took place several years earlier. That review, which included a review of the role and effectiveness of the Compliance Advisor Ombudsman (CAO), was commissioned by the Bank’s Committee on Development Effectiveness in 2019. The Review was led by an independent group of six experts in private sector development, multilateral institutions, and environmental and social sustainability. The Review Team’s Final Report was publicly disclosed by the bank in August 2020, along with an invitation for public comments on its recommendations.
At that time, Inclusive Development International submitted Joint Comments on Realizing the Right to Effective Remedy within the IFC/MIGA Accountability Framework to the World Bank Group’s Board of Directors. The comments were prepared along with Accountability Counsel, Bank Information Centre, Center for International Environmental Law and the Arab Watch Coalition.
The Review team ultimately concluded that “most CAO non-compliance findings do not lead to effective remedy,” which it attributed primarily to the IFC’s failure to address project-level compliance findings and fulfill its remedial responsibilities when harms occur. This reflected the experience of many affected communities seeking redress for adverse impacts associated with IFC/MIGA-supported projects through the CAO complaints process, including those that Inclusive Development International had supported.
Our joint submission emphasized the critical need for remedy to be centered on the needs of communities affected by projects and to be tailored and flexible enough to respond to those needs, as well as project circumstances. It urged the IFC/MIGA Board to endorse recommendations by the External Review Team aimed at ensuring effective remedial actions by IFC/MIGA and asked the Board to instruct IFC and MIGA to propose an implementation plan for public review and input. The joint submission recommended concrete reforms and identified multiple funding options to support delivery of effective remedy when harm occurs due to projects supported by IFC. Many of our concerns and recommendations remain unaddressed, including in IFC/MIGA’s draft Approach to Remedial Action published in 2023.
Inclusive Development International and 74 global partners had also submitted a joint statement to the World Bank Group’s Board of Directors expressing concerns about the lack of transparency and external stakeholder engagement in the IFC/MIGA accountability framework review.
The Responsible Critical Mineral Initiative (RCI)—formerly known as the Responsible Cobalt Initiative—and the China Chamber of Commerce of Metals, Minerals and Chemicals Importers and Exporters (CCCMC), announced in November 2022 that they would create a new accountability mechanism for the mining sector covering environmental, social and human rights issues in mineral value chains. As the first mechanism of its kind established by a Chinese industry association, this has the potential to be a significant advancement in the corporate accountability landscape.
As part of the public consultation process, Accountability Counsel and Inclusive Development International submitted recommendations for improvements to the draft procedures to ensure the new mechanism is an effective avenue for justice for communities harmed by mining activities and related value chains.
In 2015, Inclusive Development International joined 10 partners in the International Accountability Working Group (IAWG) to assess the effectiveness of the accountability systems of 11 different DFIs. This innovative comparative research was published in the report, Glass Half Full? The State of Accountability in Development Finance, which documented the hurdles placed in front of individuals and communities by financial institutions to prevent them from securing substantive financial redress. The report benchmarked each institution against criteria for effectiveness and human rights compatibility, and it concluded with a set of recommendations to improve the system. The report underscored that meaningful remedy for complainants and prevention of future harms requires more than best practices, and that a new accountability system must be established as a matter of urgency, with complaint mechanisms empowered to make binding decisions on banks and their borrowers and an end to immunity for development banks in national courts.
We have since joined with many of the same authors to publish the Good Policy Paper: Guiding Practice from the Policies of Independent Accountability Mechanisms, a roadmap for financial institutions setting up new independent accountability mechanisms (IAMs), as well as a tool for existing IAMs to evaluate the effectiveness of their current policies. The Good Policy Paper, originally published in 2021 and updated in 2024 examines the policy provisions currently in place at IAMs from the perspective of communities using them to seek redress for environmental and social harm from internationally financed projects, and identifies the most effective provisions as examples for other IAMs to follow.
Kenya’s Sex Abuse Scandal Puts World Bank in Spotlight — Foreign Policy — March 27, 2024
US DFC calls for probe of Bridge schools investment — Devex — March 26, 2024
World Bank's Banga apologizes to kids sexually abused at Bridge schools — Devex — March 15, 2024
IFC under pressure to offer compensation to alleged Bridge victims — Devex — January 30, 2024
The World Bank’s Existential Crisis — Inclusive Development International — June 22, 2016
