Development finance institutions
OHCHR and the right to development
In 2014 the UN Conference on Trade and Development (UNCTAD) estimated that achieving the Sustainable Development Goals (SDGs) would take between US$5 to $7 trillion per year, with an investment gap in developing countries of about $2.5 trillion annually. The financing gap has grown considerable as a result of the COVID pandemic. Much of the needed financing will come from domestic and international development finance institutions (DFIs ). The term ‘DFI’ includes:
- Multilateral development banks (MDBs);
- Other international and regional financial institutions;
- National development banks;
- Export credit agencies;
- Private lenders.
DFIs also have important roles to play in the global effort to combat climate change and adapt to its effects and helping States realise the right to development.
DFIs and sustainable development
DFIs play a critical role in directly financing investments needed for the realisation of the SDGs and human rights and leveraging resources from the private sector. Investment in transport, energy, water, Information Communications Technology (ICT) and other infrastructure sectors is an important part of this effort. Furthermore, the MDBs including the World Bank Group and regional development banks play important advisory and normative roles in connection with the development of national policy, legal and regulatory frameworks.
However, in order for DFIs to effectively contribute to sustainable development, it is crucial that they take necessary measures to avoid negative impacts on human rights as defined in international instruments and compatible national laws. In this regard, the 2030 Agenda for Sustainable Development and the Addis Ababa Action Agenda of the Third International Conference on Financing for Development (“AAAA”) are grounded explicitly in international human rights law. They frame the contributions of the business sector to sustainable development in terms of its responsibility to respect relevant international standards, including the UN Guiding Principles on Business and Human Rights, the Convention on the Rights of the Child, together with labour and environmental agreements.
The AAAA further encourages domestic and international development banks to establish or maintain effective environmental and social safeguard systems based on international standards, particularly relating to human rights and gender equality.
OHCHR’s work in relation to DFIs
OHCHR engages actively with MDBs and national DFIs in order to help ensure that development financing activities and policies are consistent with international human rights standards and principles, and that human rights risk information is integrated into their due diligence processes. OHCHR has worked with numerous DFIs on:
- reviewing environmental and social safeguard policies, safeguard implementation guidelines, and sectoral strategies;
- strengthening independent accountability mechanisms and public information policies;
- human rights risks of mega-infrastructure projects, and developing guidance on Public Private Partnership (PPP) contractual provisions;
- identifying and addressing human rights risks of investment projects at country level;
- strengthening policies and procedures relating to reprisals against project-affected communities;
- Internal human rights capacity building; and
- strengthening access to remedy for human rights violations caused by investment projects.
Resources
- Benchmarking Study of Development Finance Institutions’ Safeguard Policies (February 2023)
- Remedy in Development Finance: Guidance and Practice (February 2022)
- Launch event for OHCHR Remedy in Development Finance: Guidance and Practice, in collaboration with Oxfam America, on 23 February 2022, including opening remarks by High Commissioner Bachelet and Speaker of the US House of Representatives Nancy Pelosi: see recording available.
- The Other Infrastructure Gap: Sustainability – Human Rights and Environmental Perspectives(2018). Published jointly with the Heinrich Boell Foundation
Full version in English (PDF)
Executive Summary (PDF):
English | Français | Español | German Deutsch | Japanese 日本語 - Frequently Asked Questions on Multilateral Development Banks and Human Rights (2015)
Policy Briefs
- Multilateral Development Banks and Digital Risks: the Role of Environmental and Social Safeguard Policies (September 2024)
OHCHR submissions
- Comments on the draft Environmental and Social Policy of the European Bank for Reconstruction and Development (17 May 2024)
- Comments on the draft Environmental and Social Framework of the Asian Development Bank (29 April 2024)
- Comments on the Review of the FinDev Canada Environmental and Social Risk Management Policy (15 December 2023)
- World Bank Group Evolution Roadmap: Comments and Recommendations of the UN Human Rights Office (1 June 2023)
- IFC/MIGA draft Approach to Remedial Action: Comments and recommendations of the UN Human Rights Office (13 April 2023)
- Comments on the draft updated Integrated Safeguard System of the African Development Bank (17 May 2022)
- Comments on the draft Safeguards Policy of the German Environment Ministry’s International Climate Initiative (10 February 2022)
- Comments on the Draft Environmental and Social Sustainability Framework (ESSF) of the European Investment Bank (EIB) Group (August 2021)
- Comments on the Draft IFC/MIGA Independent Accountability Mechanism (CAO) Policy (16 May 2021)
- Comments on the review and update of the Asian Development Bank’s Safeguard Policy Statement (19 April 2021)
- OHCHR submissions on the third review of the African Development Bank’s Independent Review Mechanism (4 February 2021)
- OHCHR submissions on the Asian Infrastructure Investment Bank’s draft Environmental and Social Framework (6 November 2020)
- OHCHR submissions on the Inter-American Development Banks’ draft Environmental and Social Policy Framework (13 April 2020)
- OHCHR submissions to the World Bank Group’s draft Strategy on Fragility, Conflict and Violence (15 January 2020)
- OHCHR submissions for IDB Invest draft Environmental and Social Sustainability Policy (September 2019)
- OHCHR submissions for the EBRD’s draft Environmental and Social Policy (March 2019)
- OHCHR submissions for the EBRD’s Access to Information Policy (March 2019)
- OHCHR submissions for the EBRD’s Project Accountability Policy (March 2019)
- Recommendations for IDB Invest’s Public Information Policy (August 2018)
- Recommendations for AIIB Policy on Public Information (March 2018)
- Comments on the draft AIIB Project-affected Peoples’ Mechanism (March 2018)
- Recommendations for the future AIIB Complaints Handling Mechanism (May 2017)
- Recommendations for AIIB Public Information Interim Policy (May 2017)
- Comments on the Review of the Terms of Reference of the Independent Redress Mechanism of the Green Climate Fund (February 2017)
- Comments in relation to FMO Sustainability Policy and Position Statement on Human Rights (November 2016)
- Comments and recommendations in relation to the World Bank’s draft Environmental and Social Framework (March 2016)
- Comments in relation to the AIIB draft Environmental and Social Framework (October 2015)
From the High Commissioner
- Open Letter to G20 member governments on Quality Infrastructure Investment (December 2018)
- Infrastructure investment in Myanmar: Open for business? (March 2018)
- "Human rights trampled in push to build infrastructure" (March 2017)
- "Development banks need to wake up to the human rights crisis in Honduras" (March 2016)