Harmonising the human rights procedures in the environmental and social management approach of European Development Finance Institutions

The collaboration aims to support an improved integration of human rights in the procedures of EDFI members as they relate to environmental and social safeguards. Specifically, the collaboration aims to:

Harmonise EDFI members´ procedures on embedding human rights in investment processes through the development of joint guidance and operational tools informed by international standards on business and human rights such as the UNGPs and EDFI member best practices.

About EDFI

EDFI is the industry association of 15 European bilateral Development Finance Institutions seeking to strengthen information flow and cooperation between its members with a view to informing policy and driving innovation in industry standards. Development finance institutions are government-backed institutions that invest in private sector projects in low and middle-income countries to promote job creation and sustainable economic growth, and to contribute to the Sustainable Development Goals, alongside aid agencies and development banks.

Why this matters

All EDFI members have in place environmental and social management processes to identify, mitigate and account for negative environmental and social impacts in accordance with the Environmental and Social Performance Standards of the International Finance Corporation. Particularly since the adoption of the UN Guiding Principles on Business and Human Rights in 2011, some EDFI members have made a specific commitment in their Policies to respect human rights and explored ways to further integrate human rights management in current practice. The approach taken, however, has varied across EDFI members, who oftentimes co-invest in the same companies and financial institutions.

Increased harmonisation of practices and enhanced alignment with international standards can help strengthen DFI’s leverage when investing and thereby the positive effect of their environmental, social and human rights management efforts. This has the potential to improve the situation for rightsholders potentially affected by EDFI members supported projects by avoiding and addressing negative impacts on their rights associated with such projects.