Understanding IFC’s Environmental andSocial Due Diligence Process
IFC and clientagree to worktogether Publicly disclose theproject and consult withlocal communityFinalize the investmentagreementOngoing monitoringand disclosureReview and Agree on NextSteps
IFC discloses its ESRS along withrelevant sponsor E&S documentationon the IFC website. The clientdiscloses project E&S assessmentinormation locally. Projects willengage and consult with AectedCommunities to ensure theirawareness o the project, andprovide or an ongoing constructiverelationship.For projects with potential signifcantadverse impacts on AectedCommunities and projects involvingIndigenous Peoples, IFC will makea determination o the level o community support or the project.Once the World Bank Group Board o Directors approves the project:
• The investment agreement is
mutually agreed and fnalized.
• The nal agreement reects the
terms o the ESAP plus any other E&Scommitments.
• Funds are disbursed once the client
meets disbursement conditions.Monitoring occurs on twolevels:
• Site visits from IFC staff.• Submission of the client’s
Annual Monitoring Reporton progress in meeting theE&S terms o the investmentagreement.Engagement between the clientand Aected Communitiesshould be ongoing. IFC will
disclose the client’s progress
against the ESAP.During monitoring, IFC and theclient may identiy opportunityor project enhancementthrough IFC Advisory Services.
IFC’s Compliance Advisor/
Ombudsman (CAO) may alsoprovide additional oversight.The CAO is an independentofce that impartially respondsto E&S concerns o AectedCommunities, and aims toenhance IFC accountability andoutcomes.The client receives copies o:
• IFC’s Performance Standards,• Relevant World Bank Group
Environmental, Health and Saety (EHS)Guidelines, and
• Other supporting documents.
The IFC Environmental and Social (E&S)team:
• Asks the client to provide key
inormation regarding assets andmanagement o E&S risks and impacts.
• Assesses the project against the
Perormance Standards and EHSGuidelines.
• May meet with company, government,
and local stakeholders to discuss E&Saspects o the project.
• Generates an E&S Review Summary
(ESRS) and an E&S Action Plan (ESAP). TheESRS and ESAP are reviewed and approvedby the client.For IFC Clients