Washington DC, June 4, 2003 – Ten leading banks from seven countries
today announced the adoption of the “Equator Principles,” a voluntary
set of guidelines developed by the banks for managing social and environmental
issues related to the financing of development projects. The banks
will apply the principles globally and to project financings in all industry
sectors, including mining, oil and gas, and forestry.
The banks adopting the Equator Principles today are ABN AMRO Bank, N.V.,
Barclays PLC, Citigroup, Inc., Credit Lyonnais, Credit Suisse Group, HVB
Group, Rabobank, Royal Bank of Scotland, WestLB AG, and Westpac Banking
Corporation. Together, these banks underwrote approximately $14.5 billion
of project loans in 2002, representing approximately 30% of the project
loan syndication market globally, according to Dealogic.
The Equator Principles are based on the policies and guidelines of the
World Bank and International Finance Corporation (IFC). The banks
received extensive advice and guidance from IFC, the private-sector investment
arm of the World Bank, in drafting the Equator Principles.
In implementing the Equator Principles, banks currently have or will put
in place internal policies and processes consistent with the principles.
In adopting the Equator Principles, a bank undertakes to provide loans
only to those projects whose sponsors can demonstrate to the satisfaction
of the bank their ability and willingness to comply with comprehensive
processes aimed at ensuring that projects are developed in a socially responsible
manner and according to sound environmental management practices.
The banks will apply the Equator Principles to all loans for projects with
a capital cost of $50 million or more. Project finance, an important
financing method in private-sector development globally, refers to the
financing of projects where the repayment of the loan is dependent upon
the revenues that a project is expected to generate once it is up and running.
The Equator Principles will use a screening process for projects which
is based on IFC’s environmental and social screening process. Projects
will be categorized as A, B or C (high, medium or low environmental or
social risk) by the banks, using common terminology. For A and B
projects (high and medium risk), the borrower will complete an Environmental
Assessment addressing the environmental and social issues identified in
the categorization process. After appropriate consultation with affected
local stakeholders, category A projects, and category B projects where
appropriate, will prepare Environmental Management Plans which address
mitigation and monitoring of environmental and social risks.
The Environmental Assessment will address such issues as:
- Sustainable development and use of renewable
- Protection of human health, cultural properties,
and biodiversity, including endangered species and sensitive ecosystems.
- Use of dangerous substances.
- Major hazards.
- Occupational health and safety.
- Fire prevention and life safety.
- Socioeconomic impacts.
- Land acquisition and land use.
- Involuntary resettlement.
- Impacts on indigenous peoples and communities.
- Cumulative impacts of existing projects,
the proposed project, and anticipated future projects.
- Participation of affected parties in the
design, review and implementation of the project.
- Consideration of environmentally and socially
- Efficient production, delivery and use of
- Pollution prevention and waste minimization,
pollution controls (liquid effluents and air emissions) and solid and chemical
The borrower will be required to demonstrate to the bank that the project
complies with host country laws and the World Bank and IFC Pollution Prevention
and Abatement Guidelines for the relevant industry sector. For projects
in the emerging markets, the borrower would also have to demonstrate that
the Environmental Assessment has taken into account the IFC Safeguard Polices,
which provide guidance on issues such as natural habitats, indigenous peoples,
involuntary resettlement, safety of dams, forestry, and cultural property.
The full text of the Equator Principles and FAQ about the Equator Principles
can be found at Visit equatorprinciples.ifc.org
The World Bank and IFC Pollution Prevention and Abatement Guidelines are
IFC Safeguard Policies can be found at www.ifc.org/enviro/EnvSoc/Safeguard/safeguard.htm
COMMENTS FROM AND INFORMATION ON PARTICIPANTS:
ABN AMRO Bank, N.V.
"We are pleased that the banking sector is increasingly recognising
the importance of environmental and social issues in conducting its business
with its clients," said Herman Mulder, Co-Head of Group Risk Management
at ABN AMRO. "The Equator Principles will set a common baseline particularly
relevant for one of the most vulnerable areas: project financing in emerging
markets. ABN AMRO is strongly committed to taking further initiatives for
Netherlands-based ABN AMRO is a leading international bank with total assets
of approximately EUR 556 billion. It has over 3,000 branches in 66 countries
and territories, and has a staff of about 105,000 full time equivalents
worldwide. ABN AMRO is listed on the Euronext, London and New York stock
exchanges. ABN AMRO operates through three Strategic Business Units, each
responsible for managing a distinct client segment. Wholesale Clients provides
integrated corporate and investment banking services to corporate, institutional
and public sector clients worldwide. Consumer & Commercial Clients
focuses on retail and SME clients in three home markets – the Netherlands,
the U.S. and Brazil – and in a number of selected growth markets. Private
Clients & Asset Management provides private banking services to wealthy
clients and investment products to financial intermediaries and institutional
clients. For additional information: www.abnamro.com
Hans van Zon
Barclays Bank plc
"At Barclays we take our social and environmental responsibilities
seriously. We have long been aware of the sensitivities surrounding project
financing and only lend when we are satisfied that environmental impacts
are being managed in accordance with stringent environmental criteria.
We have been pleased to work alongside other leading banks to adopt
the Equator Principles, which gives us the opportunity to further formalize
our commitment,” said Chris Lendrum, Barclays Group Executive Director,
responsible for Corporate Social Responsibility.
For more information about Barclay’s approach to corporate social responsibility,
please go to social responsibility at www.Barclays.com
+44 (0) 207 699 4114
“The adoption of the Equator Principles signifies a major step forward
by the financial sector to establish a standardized, common framework to
address the environmental and social issues that arise from development
projects,” said Charles Prince, chairman and chief executive officer of
Citigroup’s Global Corporate and Investment bank. “We are extremely
proud to be part of this voluntary, private-sector initiative and we are
confident that we will see more and more banks active in project finance
adopt these principles in the coming months.”
Citigroup (NYSE: C), the preeminent global financial services company with
some 200 million customer accounts in more than 100 countries, provides
consumers, corporations, governments and institutions with a broad range
of financial products and services, including consumer banking and credit,
corporate and investment banking, insurance, securities brokerage, and
asset management. Major brand names under Citigroup’s trademark
red umbrella include Citibank, CitiFinancial, Primerica, Smith Barney,
Banamex, and Travelers Life and Annuity. Additional information may be
found at: www.citigroup.com.
"As a leader in the international project finance sector, Crédit Lyonnais
is pleased to be associated with the Equator Principles initiative as a
means of promoting environmentally and socially responsible conduct amongst
the participants in this important market, " said Alain Papiasse,
Deputy Chief Executive, Head of Crédit Lyonnais' Investment and Corporate
Banking. "We welcome the adoption, over time, of meaningful,
internationally recognized standards in this respect to the benefit of
stakeholders in project companies worldwide."
Crédit Lyonnais is one of the major French banking group with total assets
of EUR 245 billion; it is involved in all banking activities, including
retail banking in France, asset management and international private banking,
investment and corporate banking for major French and international corporations.
Additional information may be found at: www.creditlyonnais.com.
Peter Goodall Tel: 126.96.36.199.64.33 firstname.lastname@example.org
Alain Lecrivain Tel: 188.8.131.52.06.93 email@example.com
CREDIT SUISSE GROUP
"Credit Suisse Group is pleased to join this important coalition of
financial institutions in support of the Equator Principles. As a
major project finance lender globally, we are committed to operating our
business in accordance with the key environmental considerations outlined
in the Principles. Our support is consistent with Credit Suisse Group's
ongoing commitment to social and environmental sustainability in all its
business practices,” said Steven Greenwald, Managing Director, Head of
Project Finance, Credit Suisse First Boston
Credit Suisse Group is a leading global investment bank serving institutional,
corporate, government and individual clients. It is a leader in the
project finance business and a unit of Credit Suisse Group which was the
first financial institution to introduce an environmental management system
certified under ISO 14000 in 1997. In addition, Credit Suisse Group
was among the first to sign the United National Environmental Policies
(UNEP) Statement by Financial Institutions in 1992. The Group publishes
an annual Sustainability report dealing with the Group's recent environmental
and social contributions to its diverse customer, employee and geographic
community constituencies (http://www.credit-suisse.com/en/corporate_citizen/sustainability.html).
Credit Suisse Group
"The Equator Principles with their guidelines in the area of social
and environmental responsibility are an important step towards a more vigorous
advancement of sustainability in global project financing. They will help
to ensure that ecological and social standards are observed and will promote
transparency in business dealings," says Kai Henkel, Head of Global
Project Finance at HVB. "For HVB, whose adherence to World Bank standards
in lending dates back to 1998, the Principles are another component of
environmental and sustainability management. Our commitment is based on
the conviction that sustainability not only acts as security for our basic
life, but is also an important driving force behind corporate value. Sustainability
creates new growth and earnings potential, reduces credit risks and optimizes
work flows," added Henkel.
With approximately €691 billion in total assets, about 8.5 million customers
and over 65,000 employees, the HVB Group is the second largest private
commercial bank in Germany, the clear number one in Austria and the leading
bank in the growth markets of central and eastern Europe. The HVB Group
has been very successful for a long time in environmental and sustainability
management. Since September 2000 HVB has been included in the Dow Jones
Sustainability Index (DJSI), which shows the performance of enterprises
in the whole world which are rated among the leading 10% in their sector
as far as sustainability is concerned.
Further information on HVB Group and our sustainability activities are
obtainable at: www.hvbgroup.com/sustainability.
+49 (0)89 378 25424
International Finance Corporation - IFC
“The adoption of these Principles by the private sector marks a profound
victory for sustainable development,” said Peter Woicke, executive vice
president of IFC and managing director of the World Bank Group. “Over
the last several months, we at IFC have worked closely with private sector
banks as they have drafted the Equator Principles, which draw on the extensive
work the IFC has done in developing rigorous, comprehensive approaches
to ensuring that the environmental and social impacts of project financings
conform to the objective of sustainable development.”
The mission of IFC is to promote sustainable private sector investment
in developing countries, helping to reduce poverty and improve people's
lives. IFC finances private sector investments in the developing world,
mobilizes capital in the international financial markets, helps clients
improve social and environmental sustainability, and provides technical
assistance and advice to governments and businesses. Since its founding
in 1956 through FY02, IFC has committed more than $34 billion of its own
funds and arranged $21 billion in syndications for 2,825 companies in 140
developing countries. IFC's worldwide committed portfolio as of FY02 was
$15.1 billion for its own account and $6.5 billion held for participants
in loan syndications.
Corrie Shanahan Tel: (202) 473-2258 Cell: (202) 415-9676 firstname.lastname@example.org
Joseph O’Keefe Tel: (202) 458-4032 email@example.com
“Sound business principles are essential for sustainable development all
over the globe,” said Bart Jan Krouwel, Rabobank Managing Director Sustainability
and Social Innovation. “Business and entrepreneurship in developing
countries has to go hand in hand with good citizenship and transparent
corporate governance. Therefore, I am delighted that so many players
in the financial sector got their responsibility and agreed to follow the
Equator Principles for project finance covering all industries and business
sectors. Rabobank is convinced, as a major worldwide financial services
provider in the food & agribusiness that this is the way forward to
a sustainable society.”
In its Dutch home market, Rabobank Group has nine million business and
private customers and is market leader in virtually every area of financial
services. Outside the Netherlands, the Group has 143 offices, employing
a total of 5,928 people in 34 countries. Consistently being awarded
a AAA credit rating from the leading rating agencies, the bank's stability
is further evidenced by its receipt of the Global Finance award: World's
Safest Bank in 2001 and again in 2002.
Jan Ph. K. Dost
Royal Bank of Scotland
“Observing the highest standards of corporate citizenship and behaviour
not only benefits our business, but is the right thing to do. I am
delighted that RBS is supporting this important initiative”, said Johnny
Cameron, Chief Executive, Corporate Banking and Financial Markets, The
Royal Bank of Scotland.
“The Corporate and Social responsibility agenda is one that is developing
rapidly. While we already comply fully with the legislative and regulatory
framework set by governments, we continue to adopt policies that progressively
integrate social, environmental and ethical issues into all aspects of
“The guidelines laid down in the Equator Principles are another important
step in ensuring we continue to set and maintain ever higher standards.”
About The Royal Bank of Scotland
The Royal Bank of Scotland was founded in 1727 and is a broadly based financial
services group with operations spanning clearing banking, corporate banking,
treasury, capital markets, financial services, investment management and
insurance, in the UK, Europe, USA and Asia. It is the second largest
in bank in Europe and the fifth largest banking group in the world by market
capitalisation. The Group serves over 20 million customers. Through its
Corporate Banking and Financial Markets division it provides a fully integrated
Corporate, Institutional and Financial Markets capability to The Royal
Bank of Scotland and NatWest international corporate and institutional
client base. Further information on RBS can be obtained at www.rbs.co.uk,
and on its approach to Corporate and Social Responsibility at http://www.rbs.co.uk/Group_Information/Corporate_Responsibility/default.htm
The Royal Bank of Scotland Group
Tel: +44 (0) 131 523 4414
“The Equator Principles offer a practical approach to sustainability in
project finance. The fact that this approach has been worked out by banks
themselves testifies to the sincerity with which the industry seeks to
live up to new challenges,” said Andreas Seibert, Member of the Board,
WestLB AG is one of Germany´s leading internationally operating banks.
As a focused commercial bank, it offers its customers – corporates, institutional
investors, banks, savings banks and public-sector clients – a wide range
of financial services in the fields of Financial Structuring, Equity Solutions,
Credit Products, Treasury & Fixed Income and Asset Management. A main
focus of its business is specialised finance, in particular project finance.
Further information on WestLB AG is obtainable at www.westlb.de.
Dr. Michael Wilde
Westpac Banking Corporation
Westpac's Group Executive Institutional Banking, Phil Coffey, said: "The
adoption of these principles is an important step forward in promoting
responsible project financing globally. We are pleased to support
this sustainability initiative and encourage other financial institutions
to adopt these principles."
Westpac was founded in 1817 and is Australia's first bank and company.
We are a leading provider of banking and financial services in Australia,
New Zealand and the Pacific Region servicing some 7.5 million customers.
We offer a full suite of financial services including retail banking,
institutional banking and wealth management services. Further information
on Westpac can be obtained at www.westpac.com.au
+61 2 9226 3510
+61 (0) 419 683 411