Conferência Ethos 2012

1. Ethos International Conference
Business and Civil Society in the New Economy
June 13, 2012
Office of the Compliance Advisor Ombudsman (CAO)
for IFC and MIGA
1

2. Birth of “accountability model” arose from
1992 Rio Summit
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3. Independent Accountability & Recourse
Mechanisms
 World Bank responded by setting up “Inspection
Panel” (1993) to respond to civil society concerns
 CAO created in 1999 for World Bank private sector
 Today, all multilateral development banks have
“Independent Accountability Mechanisms”:
- African Development Bank (AfDB)
- Asian Development Bank (ADB)
- European Bank for Reconstruction and Development (EBRD)
- European Investment Bank (EIB)
- Inter-American Development Bank (IDB)
3

4. Who is the Compliance Advisor
Ombudsman (CAO)?
 Independent accountability & recourse
mechanism for IFC & MIGA, World Bank Group
 Social & environmental mandate
 Triggered by locally impacted communities
 100+ complex multiparty disputes in 38 countries
4

5. “Citizen-led” accountability & recourse
World Bank Group Board
PRESIDENT
Robert B. Zoellick
IFC MIGA
Private Private Private
sector client sector client sector client
Project-affected
communities
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6. CAO works at the intersection of
corporate - community conflict
6

7. Hydropower,
Himachal Pradesh, India

8. Water privatization,
Guayaquil, Ecuador

9. Sugar industry,
Chichigalpa, Nicaragua
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10. Palm oil, West Kalimantan &
Sumatra, Indonesia

11. Oil pipeline, Chad &
Cameroon

12. Overview of CAO’s work 2000-2012:
Regions
 Latin America accounts for almost 40% of complaints
 Complaints from Asia region on increase
 Mobilized regional civil society?
 Greater awareness of IFC, and CAO?
2% 2%
8% Latin America and Caribbean
Sub-Saharan Africa
13% 39% South Asia
East Asia and the Pacific
Europe and Central Asia
15% Middle East and North Africa
World a
21%
IFC/MIGA Projects in CAO Cases by Region, FY00-12 12

13. Sectors
Four industry sectors predominate in complaints:
 Extractive industries, infrastructure, agribusiness
& manufacturing
 Pattern reflects resource intensity of these industries
- i.e. land and water use
3% 2%
Oil, Gas, Mining and Chemicals
13% Infrastructure
32%
Agribusiness
Global Manufacturing & Services
21% Financial Markets
Advisory Services
29%
IFC/MIGA Projects in CAO Cases by Industry, FY00-12
13

14. Environmental & Social Issues
 Socio-economic grievances characterize 80% of
complaints = access to & distribution of local benefits
 Consultation & disclosure (73%), Land (60%),
Water (45% - rises to 90% in mining projects)
90%
81%
80% 77%
73%
70%
60%
60% 53% 52%
% of Cases
50% 45%
40% 35%
30%
20%
20% 15%
11%
10%
0%
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Frequency of Issues Cited in CAO Cases, FY2000-12

15. What is the framework that informs
CAO’s work?
 Policy on Social and Environmental
Sustainability
 Performance Standards 1-8:
1. Assessment & Management of Social and Environmental
Risks and Impacts
2. Labor and Working Conditions
3. Resource Efficiency and Pollution Prevention
4. Community Health, Safety and Security
5. Land Acquisition and Involuntary Resettlement
6. Biodiversity Conservation & Sustainable Management of
Living Natural Resources
7. Indigenous People
8. Cultural Heritage
 Policy on Disclosure of Information
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16. Voluntary standards & guidelines for
private sector
 IFC standards applied by broader private sector
- Equator Principles: Environmental and social standards
covering 90% of global project finance
- Used by 30+ OECD Export Credit Agencies
- Used by European Development Finance Institutions
- Global benchmark used by significant number of industry
associations & companies worldwide
 Voluntary initiatives & principles:
- UN Global Compact
- UNEP Finance Initiative
- Global Reporting Initiative (GRI)
- UN Business and Human Rights Guiding Principles
- OECD Guidelines
- Extractive Industries Transparency Initiative (EITI)
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17. Even with the best standards & commitments,
can you predict where conflict will arise?
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18. Mapping a conflict
Country X
Province Y
is resource
rich
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19. Geophysical mapping of the asset
Governor of
Province Y supports
private sector
investment

20. Delineation of land parcels
Permits issued
by national
government
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21. Company acquires permits for
exploration in specific corridor
Has international
financing and
support of
national and
provincial
governments
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22. Tribal communities claim ancestral
domain
Claim
company has
violated their
lands without
Free, Prior, &
Informed
Consent
(FPIC)
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23. National Council for Indigenous Peoples
determines ancestral boundaries
Excludes one
tribal
community -
decision
determines
company
consultation
strategy
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24. Tribal communities are divided
Chiefs are
divided for &
against
mining
activities
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25. Municipal boundaries
Elected
mayors also
have
oversight of
their
domains
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26. National Department of Environment
defines forestry reserves
Overlaps with
lands
permitted for
mining
exploration
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27. Village boundaries & elected captains
Conflict over
tribal land
claim which
overlaps
with village
land
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28. Company embarks on CSR projects
With villages
and one tribal
community
“for” the
project
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29. NGOs start a campaign against mining
Support
interests of
disgruntled
tribal
community
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30. Complexity makes conflict inevitable
What can you
do about it?
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31. You have to uncover common interests

32. Tools you can use
 Early social mapping - interest-based to identify
conflict potential
 Livelihood needs assessment (communities)
 Give people an opportunity to participate in the
project
 Participatory approaches when facts are in
dispute
 Where there is conflict,
use dispute resolution:
- Mediation, facilitation,
assisted negotiation
BUT, there is no one
model or solution 32

33. Summary: Outstanding questions
 Are voluntary standards credible to civil
society?
 Transparency: what is disclosed?
- The project & CSR strategy?
- Or outcomes on the ground?
 Accountability: by whom and to what?
- Are there publicly accessible mechanisms to provide
accountability/recourse against commitments made?
- E.g. Equator Banks?
 What about mandatory frameworks?
- Is self-regulation enough in the context of Rio+20
goals and a lack of government leadership in most
regions? 33

34. CAO Film: Building Company-Community
Dialogue in the Philippines
Film produced by Corporate Social Responsibility Initiative at
Harvard & UN Business and Human Rights Program
See BASESWiki: Business & Society Exploring Solutions
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http://baseswiki.org/en/Video/Philippines_Dialogue

35. Contact us
Compliance Advisor Ombudsman for IFC & MIGA
2121 Pennsylvania Avenue NW
Washington, DC 20433
www.cao-ombudsman.org
www.facebook.com/CAOoffice
www.cao-ombudsman.org