The Bank Information Center joined Accountability Counsel in welcoming the introduction of Chairwoman Maxine Waters’ and Congresswoman Joyce Beatty’s International Financial Institution Improvements Act of 2024 on October 23, 2024. This comprehensive legislation directs the U.S. to advocate for improved environmental, social, accountability, and transparency standards at the IFIs in which it is a member. This bill also reflects the priorities of broader civil society around the need for the IFIs to improve their due diligence before project approval and provide remedy when their projects cause harm. Specifically, we welcome the following provisions:
- Independent Accountability Mechanisms (IAMs): Mandates the Treasury Department to work with the IFIs to support and increase the effectiveness of the IFIs’ IAMs via engagement with IFI management and other Executive Directors, and advocates for the IFIs’ adoption of responsible exit policies.
- Sexual Exploitation and Assault (SEA) Prevention: Mandates that the Treasury Department consults with the IFIs on how they are operationalizing their policies and guidance on preventing SEA, and requires the Treasury Department to report to Congress on these outcomes, including the number of SEA cases reported to each IFI and the number of cases involving minors.
- Accountability for Child Sexual Abuse: Requires the Treasury Department to report quarterly on the actions completed by the International Finance Corporation (IFC) to compensate the survivors of child sexual abuse harmed by its Bridge International Academies project with financial compensation and other relief.
- Publication of Loan Agreements: Mandates that the Treasury Department seeks to require private and public sector IFI project loan agreements to be made public as a condition of the U.S. voting in favor of projects.
- Adoption of Anti-Reprisal Standards: Mandates that the Treasury Department encourages the IFIs to adopt anti-reprisal and retaliation standards in their safeguards policies and loan agreements to enhance accountability when reprisals occur.
- Climate Finance Transparency: Requires that the U.S. push for the IFIs’ public disclosure of their internal methodologies for calculating the climate impact of their projects, including explanations of their processes and practices for making these assessments.
Many IFIs, most notably the World Bank Group, are undergoing ambitious reform agendas to revamp how these institutions respond to global challenges. As part of this process, several IFIs are requesting increased funding from donors, the United States being one of the largest. Negotiations around these requests are critical moments for the U.S. to push the institutions to adopt and implement policies to protect the environment and project-affected communities from the potential negative impacts of development projects. Reps. Waters and Beatty’s International Financial Institution Improvements Act meets the moment and would require the U.S. to take strong positions during general capital increase and replenishment negotiations. We urge Congress to utilize its oversight role in directing U.S. policy at the IFIs and pass this critical legislation. The value of U.S. leadership at the IFIs is essential to pushing these institutions to fulfill their mandates and center accountability and project-affected communities in all of their work.
Read our press release about the Act here.