The UN Secretary General panel’s just transition principles call for human rights to be at the core of mineral value chains. The IFC, a key enabler of transition mineral mining, must operationalize this principle through an overhaul of its Performance Standards.
Embracing a new remedy approach in line with the UNGPs will support the World Bank to tackle the crises of our time without externalizing risk onto the poor communities it is committed to serve. The alternative is grim: A bigger Bank, externalizing the costs of development on the poor, with greater speed and at greater scale than ever. That is why we say there can be no evolution without remedy.
China’s groundbreaking Green Finance Guidelines require both policy and commercial banks to establish grievance mechanisms for affected communities. The newly formed National Financial Regulatory Administration should see to it that Chinese banks implement this requirement.
As Adani Group stocks tanked last month, following revelations of fraud and market manipulation at the Indian conglomerate, some investors in ESG-focused funds were surprised to find themselves exposed to losses.
Earlier this year, my colleagues at Inclusive Development International published an investigation that revealed a staggering figure: more than US$13 billion of ESG-labeled investments have gone to companies involved in arming, funding and legitimising the brutal military regime in Myanmar. As shocking and disturbing as that is, it is not an anomaly.
On June 1, Beijing issued green finance guidelines for Chinese financial institutions. Notably, Chinese banks and insurers are asked, for the first time, to establish grievance mechanisms to manage clients’ environmental, social and corporate governance (ESG) risks.
In July 2016, environmental activist Gloria Capitan was brutally killed in front of her 8-year-old grandson in the Bataan province of the Philippines, allegedly due to her anti-coal advocacy as the leader of the Coal-Free Bataan Movement. Climate change is perhaps the biggest threat that humanity faces, yet the people who devote their lives to this cause are under attack.
ESG-labeled funds have exploded in popularity in recent years, hitting $3.9 trillion in assets under management last year. Driven by marketing claims that ESG is a way for investors to align their money with their values, it’s now the fastest growing sector of financial services. But these funds are littered with companies with appalling records.
