World Bank review shows flaws in social, environment safeguards process

Wednesday, July 16, 2014

(Reuters) – The World Bank has systemic defects in its procedures to ensure that people and the environment are not harmed in development projects, according to an internal review obtained by Reuters.

The global development lender is undergoing the first major update to its social and environmental protections in decades, which are likely to influence other international institutions.

Non-profit groups fear the bank may weaken its protections to speed up lending approval and better compete with development rivals, although it has said it aims to keep the safeguards as strong as ever in its efforts to combat poverty worldwide.

But even the current management of safeguard risks has problems, according to the review, conducted by the bank’s internal audit department.

Employees who focus on reducing social and environmental damage from projects lack independence or incentives to do a good job, and the World Bank has little oversight over how well their advice is followed and how much money is devoted to safeguards. The most experienced specialists are not necessarily assigned to the riskiest projects, according to the review.

Source: Reuters (link opens in a new window)

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Entrepreneurship, Environment
Tags
Base of the Pyramid, poverty, social entrepreneur, sustainability