The 2023 World Bank Group and International Monetary Fund Annual Meetings presented an opportunity for the Bank to have discussions with civil society about their work over the last year and plans for the future.
There was plenty of news to come out of the meetings, but the central update came from the Development Committee report on “Ending Poverty on a Livable Planet: Report to Governors on World Bank Evolution.” This document sets out the Bank’s new vision, “to create a world free of poverty on a livable planet” and mission to “end extreme poverty and boost shared prosperity on a livable planet.” The Bank has heralded the inclusion of “livable planet” as a signal of its commitment to address climate change as the climate crisis threatens poverty and development gains. However, the inclusion of a “livable planet” is meaningless unless the Bank makes significant improvements in its approach to Paris alignment, namely closing loopholes and following the Intergovernmental Panel on Climate Change (IPCC) recommendations on pathways for meeting the targets in the Paris Agreement. While we support the new climate focus, the Bank should define or clarify what it means by a livable planet and how it will affect projects and operations moving forward.
At the meetings, World Bank Group President Ajay Banga emphasized that the newly expanded mandate will ultimately help the Bank fulfill its goal of becoming a “bigger bank.” In response, CSOs flagged that becoming a bigger bank by increasing the scale and scope of lending will necessarily increase the risks posed by Bank-financed projects to people and the planet. CSOs urged Banga to dedicate equal attention to improving the quality of Bank investments, becoming a better Bank by proportionally increasing the resources allocated to monitoring and supervising the implementation of environmental and social safeguards and strengthening accountability systems. CSOs raised specific concerns around the Bank’s private sector lending, including the IFC’s lack of transparency and accountability and failure to provide remedy.
With the unveiling of the Bank’s new vision and mission, there was unsurprisingly a strong focus on climate throughout the week. While this reflects the Bank’s goal of becoming a ‘climate bank,’ there were no commitments to change its environmentally harmful lending or enhance its approach to Paris alignment. In fact, during the Civil Society Townhall, President Banga praised the Bank for only providing $170 million in finance for fossil fuels last year, but this number has been disputed by CSOs monitoring the Bank’s investments.
Banga also shared an update on the Corporate Scorecard and the plans to dramatically decrease the current number of indicators in order to focus more directly on the impacts and outcomes of Bank financing on achieving global goals. Along with this push for more efficient measurement of impact, the Bank is looking for areas in its operational model where it can be more efficient. This includes efforts to “streamline” the implementation of the Bank’s core environmental and social requirements for projects it finances, the Environmental and Social Framework (ESF). Through this ESF streamlining process, the Bank will aim to shift towards greater reliance on borrowers’ own environmental and social safeguarding systems to avoid duplicating requirements where risk is lower and will aim to cut down on upfront due diligence and the multiple layers of approvals for lower-risk projects. BIC and partners have welcomed the Bank’s proposals to shift greater resources to building borrower government capacity to implement safeguard requirements and put more staff capacity and time into monitoring and supervision during project implementation. At the same time, however, CSOs have cautioned that the Bank must retain strong upfront due diligence and enhanced supervision for projects that have greater overall risks, or where there is a risk of significant human rights impacts like SEA/H, discrimination against marginalized groups, or reprisals.
In both his opening press conference and the townhall with CSOs, Banga talked about how the Bank needs to do more to support the inclusion of women and young people and how this “will be a critical part of the World Bank’s mission going forward.” But when questioned about how youth will be included or represented in decision-making, Banga and other Bank staff failed to provide a straightforward answer. Going forward, we would like to see more consideration of children’s unique risks and needs in their projects as well as more consideration of the intersectional nature of global crisis. The Bank’s new Gender Strategy provides just such an opportunity to strengthen the Bank’s focus on intersectionality and highlight how the Bank can address the disproportionate impact that climate change can have on women, girls, or LGBTQI+ people.
As the World Bank continues to evolve it is critical that it genuinely work towards the creation of a poverty free world on a liveable planet across all of its investments. To do that, it must genuinely prioritize transparency, accountability, inclusion, and engagement with those directly affected by its projects.