As of this year, the European Bank for Reconstruction and Development (EBRD) - [which plays a crucial role in sustainable development with over 7,300 projects across three continents] - will start implementing its updated Environmental and Social Policy and Access to Information Policy. These policies set the EBRD’s environmental, social, and human rights standards, as well as obligations for its public and private sector clients. Feedback from civil society organisations like Bankwatch, project-affected communities, and institutions such as the United Nations Office of the High Commissioner for Human Rights (OHCHR) has led to significant improvements in transparency, stakeholder engagement, and human rights due diligence. However, accountability gaps remain.
One of the most significant improvements is the EBRD’s commitment to greater transparency. The EBRD will now proactively disclose environmental and social information, reducing barriers for stakeholders seeking access. Additionally, it has introduced a public interest override to prioritise transparency over non-disclosure commitments when necessary.
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In the past, public transport projects in Sarajevo and Tbilisi lacked transparency, excluding citizens from decision-making. […] As a result, concerns raised by women and other vulnerable groups regarding routes, security, and accessibility were overlooked. The new transparency commitments should help prevent such oversights.
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The new policies require financial intermediary banks to establish grievance mechanisms, disclose their environmental and social management systems, and report on implementation. This is a step forward, but it remains unclear how affected individuals will be informed of their rights and access to the EBRD accountability mechanisms when needed.
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Another improvement is a new EBRD commitment to disclose the amounts and sources of technical assistance funding and grant financing. It also lowers the threshold for publishing project summaries for grant-funded activities not tied to specific projects. However, without a requirement to disclose outcomes, accountability remains weak, especially for public-sector initiatives.
For example, in the Karaganda WWTP Modernisation project in Kazakhstan, the EBRD allocated over EUR 1 million in technical assistance for a feasibility study and environmental and social impact assessment. Civil society groups raised concerns that the proposed plant might not meet the growing population’s needs or address water losses from outdated infrastructure. However, a lack of public access to the feasibility study undermined consultation efforts and limited the project’s potential benefits for essential infrastructure development.
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For the first time, the EBRD has formally recognised human rights as a core element of project assessment and management. The updated Environmental and Social Policy requires projects to factor in governance risks, civic space restrictions, and stakeholder concerns, ensuring a more context-specific approach to risk management.
For instance, the EBRD will now have to consider risks posed by laws restricting civil society in Kyrgyzstan and Georgia, the criminalisation of LGBTIQ+ people in Uzbekistan and Turkmenistan, media censorship in Azerbaijan and Tajikistan, and the absence of civil liberties in Egypt and Turkey. These risks should inform project categorisation, impact assessments, mitigation measures, and monitoring and accountability frameworks.
Another notable step forward is the EBRD’s commitment to assessing retaliation risks and working with clients to prevent reprisals against project-affected people, a provision that the Environmental and Social Policy had previously overlooked. It now introduces requirements for clients to develop relevant policies and ensure stakeholder engagement is free from harassment and reprisals. However, given that the clients themselves are often responsible for these acts of retaliation, the EBRD must first and foremost strengthen its own due diligence processes to hold clients accountable whenever these risks arise.
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Additionally, the Environmental and Social Policy mandates assessments of digitalisation risks and supply-chain impacts, which are particularly relevant given the EBRD’s focus on green investment. The policy’s commitment to using sex-disaggregated data to capture gender-specific impacts is another welcome development.
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Civil society has long criticised the EBRD’s reliance on client-provided information and its consistent lack of independent verification. The new policy requires the EBRD to integrate stakeholder perspectives into risk assessments and enhance external validation of reported data.
For projects with significant community impacts, the EBRD may now conduct its own stakeholder consultations before approval, adding a layer of accountability. However, simply considering the views of stakeholders is not enough. The EBRD must also proactively seek out their opinions, particularly in countries with democratic deficits. For instance, the problematic Amulsar gold mine and Indorama Agro cotton projects, both backed by the EBRD, show how things can go badly wrong when the views of stakeholders are ignored and the early warnings of civil society organisations are not heeded.
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Additionally, the new requirement for trade union consultations means the EBRD must foster an environment where independent workers’ organisations can thrive without undue influence from the client. As a case in point, the replacement of a democratically elected union with a less representative coalition on the Indorama Agro project in Uzbekistan illustrates the risks of failing to ensure these enabling conditions are met.
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