Despite the IFC’s clear commitment to improving its environmental and social performance – it is still coming under scrutiny for the variety of projects it invests in.
It is interesting to see two Financial Institutions sizing up each others environmental and social policies and investments, and I suspect this is just the start of an era when banks will be attempting to gain the leading edge based on the environmental and social preformance of their business.
The Co-operative Bank stated that:
“We’ve looked at the recent investments of the World Bank’s IFC and concluded that there is an unhealthy focus on fossil fuel technologies. Henceforth, we will withhold investments until such time as renewable technologies are much better supported”, said Paul Monaghan, Head of Sustainable Development, at The Co-operative Bank. Industry monitors estimate that in 2005 the IFC was the world’s largest multilateral financier of fossil fuel extraction. Meanwhile, the agency devoted a mere 4% of its total energy lending to renewables in the past year, and has set no concrete goals for increasing such financing. “We are very pleased at The Co-operative Bank’s action. Climate change is the single greatest threat facing the planet. Yet the IFC uses public funds to subsidise rich oil giants who exploit fossil fuel resources in developing countries,” said Tony Juniper, Executive Director of Friends of the Earth, England, Wales and Northern Ireland (1).