Published 20 October 2020
In my latest book Environmental Recourse at the Multilateral Development Banks, I probe the increasing use of what are known as international grievance mechanisms in international development financing. While this may seem niche, it really gets to the heart of how we could resolve or pre-empt environmental conflicts, which are on the rise around the world.
In short, international development financing seeks to provide developing states with funding for projects for things like generating energy, building telecommunications, and infrastructure to address poverty and improve peoples’ lives. Yet development projects may have dramatic and irreversible environmental and social impacts.
So, given large but variable flows of private direct foreign assistance, and ongoing financing through official development assistanceand multilateral financing, what are the available options to communities to protect their environmental rights, and the rights of nature?
Potential Harms from International Development
Since the 1980s, environmental and social standards have emerged and strengthened for private and public development funders. In the 1990s, locally affected communities and concerned environmental NGO’s pushed for recourse mechanisms to mediate the power of Multinational Corporations (MNCs) and international organisations (IOs) like the World Bank around environmental and social harm.
Concerns over loss of land, livelihoods, and lives, species extinction, irreparable damage to local ecosystems, and a breakdown in social cohesion are all potential harms from international development projects. Many developing states often favour the right to exploit natural resources and labour over the concerns of local communities, which has led to the creation of international mechanisms to mediate between MNCs, IOs, and locally affected communities.
Do International Grievance Mechanisms Provide Enough Protection?
International grievance mechanisms are processes which seek to provide recourse for locally affected communities. These can be quite disparate processes, from industry associations like the Fair Trade Association, to MNC specific recourse processes as enacted by Adidas, to the Inspection Panel of the World Bank.
In the book, I parse out the underlying normative underpinnings of these international grievance mechanisms, which either hew to the UN Guiding Principles on Business and Human Rights,for the private sector or the environmental and social standards established by the World Bank and used for multilateral and bilateral lending.
While the proliferation of international grievance mechanisms is laudable, they are not legal processes and therefore are not enforceable. They provide recourse but are not held to providing a remedy for the harm.
Independent Accountability Mechanisms and Environmental Recourse
As a result of this lack of transparency, the Multilateral Development Banks established a subset of grievance mechanisms called the ‘independent accountability mechanisms’ (IAMs), which enable us to examine whether or not communities can have recourse to uphold their environmental rights.
In the book, I look at the environmental procedural rights that are increasingly being recognised not only in the UN Guiding Principles and implicitly in the World Bank’s environmental and social standards but in regional UN treaties: the right to access to information, access to participation, and access to justice in environmental matters.
My first aim was to see whether or not communities were actually invoking recourse for these rights, and, given the people centred nature of these mechanisms, whether or not they were also trying to use them to defend nature in and of itself.
So, I analysed394 original claims by locally affected people to see if they were invoking these rights. 49% of claims wanted recourse for a failure to be informed of the developments in their communities, and 54% identified a lack of access to participate in the decision making process that affects them. A further 27% of claims were concerned with the impact of the development on the environment as independent of people’s reliance on it (such as species and habitat loss).
Upholding Access to Justice
Were peoples’ access to justice upheld in the process?I drew on a database I created of all known submissions to the IAMs(1,052 claims from 1994 to mid-2019), to examine what happened when people went through the process of seeking recourse for a failure to uphold these rights.
Here is where it gets interesting. The mechanisms have dual functions, allowing people to meet with the project sponsors and financiers to discuss how to address the harm (called problem solving), or to ask the mechanism to investigate whether it was the Banks omissions or acts that led to environmental and social harm (compliance investigation).
While the book demonstrates how the processes work in a generally just manner, it also shows that the problem-solving function can only work if it is in the interests of claimants, the Bank, the government, and/or the project sponsor (for non-sovereign loans). This leads to a high rate of unsuccessful outcomes from communities attempting to engage directly with the Banks and project sponsors.
In using the compliance investigation function, the mechanisms have found the Banks non-compliant with their environmental and social protection standards, showing a willingness of the IAMs to reveal Bank wrong-doing leading to harm. Moreover, the IAMs have increasingly been given power to monitor the Banks to bring them back into compliance.
Ultimately however, the mechanisms enable people to air their grievances, without necessarily solving their problems. Moreover, we have little indication that the rights of nature can be protected within such processes, which means more work is needed to find methods to protect a threatened planet.
Environmental Recourse at the Multilateral Development Banks is now available from Cambridge University Press, as part of their Elements in Earth System Governance series. To find out more and to download, please visit the Cambridge University Press website.
Susan Park is Professor of Global Governance at the University of Sydney. She focuses on how state and non-state actors use formal and informal influence to make the Multilateral Development Banks (MDBs) greener and more accountable. Susan is the Research Lead on The Global Shift to Renewables and Environmental Disasters and Just Governance.