Equator Principles

In the Beginning

In June 2003, a coalition of investment banks launched the Equator Principles, a set of voluntary project finance standards based on the social and environmental safeguard policies of the private finance arm of the World Bank – the International Finance Corporation (IFC). Banks that endorse the Equator Principles (EPs) commit to categorize projects based on their social and environmental sensitivity. For the most sensitive projects, banks would require corporate clients to prepare environmental assessments, do public consultation, and create mitigation plans. The banks would then require such mitigation as a part of its loan agreement with the client. Because many large and controversial projects such as oil pipelines and dams are often funded through project finance, the Equator Principles have the potential to promote more responsible corporate behavior.

Progress Report

When the initiative was launched in 2003, Friends of the Earth welcomed the idea, but withheld applause until it could be shown that these institutions adhered to the safeguards they set. As always, banks and the voluntary initiatives they develop will be judged by the real world impacts of the projects they finance. Over the past five years, Friends of the Earth has evaluated and pressured the Equator Banks.  Here are some of the documents in the regards to the EPs: