Toolkit Issue 3, Section 1

20 November 2003

I. The World Bank Safeguard Policies

Since the 1980s, the World Bank has been developing and revising a set of Operational Policies in response to widespread criticism, primarily by NGOs and some donor governments, that Bank projects cause ecological and social destruction. In 1980, the Bank wrote its first policy on involuntary resettlement, and in 1982 it established a policy on Tribal People in Bank-Financed Projects which was revised in 1991 as Operational Directive (OD) 4.20 on Indigenous Peoples. The Bank established its first environment department in 1987, and wrote its first Environmental Assessment Policy in 1988. The EA policy was updated as OD 4.01 in 1991.

Recently, the Bank has taken ten of its environmental and social policies and created a category called "safeguard policies," which together are designed to protect the environment and vulnerable populations from negative effects of Bank-financed operations. The policies that fall within this category are: OP 4.01, Environmental Assessment, OP 4.04 Natural Habitats, OP 4.36 Forestry, OP 4.09 Pest Management, OD 4.30 Involuntary Resettlement, OD 4.20 Indigenous Peoples, OPN 11.03 Cultural Property, OP 4.37 Safety of Dams, OP 7.50 Projects on International Waterways, and OP 7.60 Projects in Disputed Areas. Table 1 (shown at the end of this Toolkit) summarizes the key features of the policies.

While many of the policies have been in place for almost ten years, Bank compliance with them has been wholly inadequate. To enhance policy compliance, and in response to external pressure from NGOs and locally affected people, the Bank has created two important mechanisms. The first, created in 1994, is the Independent Inspection Panel, a quasi-independent body established to hold the Bank accountable to its policies and procedures. The three-member panel is the only mechanism by which citizens harmed by Bank projects can exercise the right to bring claims to the Bank in order to seek remedies and to press for Bank accountability. The second, created in 1998, is the Quality Assurance Compliance Unit, an internal team of Bank staff that review projects that are in the Bank's pipeline or in implementation for compliance with the safeguard policies.

This toolkit will summarize the Bank's "safeguard policies," describe who is responsible for implementing them, and briefly describe the roles of the Quality Assurance Compliance Unit and the Independent Inspection Panel.

Recent Changes in Bank Policies Weaken Protection

While the Bank is promoting policy compliance and emphasizing the importance of the safeguard policies through internal training and policy promotion, they are simultaneously weakening some provisions within the policies themselves. As part of its response to the Inspection Panel [Note:4], and to deal with ongoing problems managing the quality of its portfolio, the Bank is in the process of converting all of its 400 policy documents-including the safeguard policies-into one format. According to an internal Bank memo, "the conversion process is meant to distinguish between the 'bottom line' of what is mandatory policy and the 'would it not be nice to have' statements of intentions." When the conversion process is completed, the Bank expects to have between 60 and 70 policies.

Operational Directives are the only Bank policy statements that are approved by the Board of Executive Directors and are mandatory for all Bank staff. They are the policy statements formally used by the Inspection Panel to determine violations of policy when claims from affected citizens are presented. These Operational Directives are being converted into a three-tiered format comprised of Operational Policies, Bank Procedures and Good Practices (OP/ BP/ GP). Operational Policies and Bank Procedures are mandatory - Bank management and staff must implement them in the Bank's operations. Good Practices on the other hand, do not constitute mandatory actions, but are guidelines that operational staff can use. The conversion process has unfortunately weakened the Bank's environment and social policy framework, by weakening language and by moving formerly mandatory requirements into the "good practice" statement. While the process is not yet completed, NGOs have analyzed several policies that have been converted to date and have found that the reformatted versions limit the Bank's responsibilities towards project affected people [Note:5]. Table 1, at the bottom of this page, identifies which policies have been converted.

What Other World Bank Policies Are Important to Social and Environmental Concerns?

Apart from the "safeguard policies," there are a number of other Bank policies that NGOs and Civil Society organizations should be aware of. Perhaps the most important policy for citizens is Bank's Policy on Disclosure of Information, which outlines those Bank documents that must be made available to the public and when in the project cycle they can be accessed. For more information about this policy, see the BIC Toolkit Getting Access to Information from the World Bank: The Fundamentals.

The following policies and procedures are also useful:

• OP 4.02 Environmental Action Plans
• OP 4.07 Water Resources Management
• OP 4.15 Poverty Reduction
• OP 4.20 Gender Dimensions of Development
• GP 4.46 Energy Efficiency and Conservation
• OP 8.60 Adjustment Lending
• OP 10.20 Investments Under the Global Environment Facility
• OP 10.21 Multilateral Fund of the Montreal Protocol
• OD 13.05 Project Supervision
• GP 14.70 Involving Nongovernmental Organizations in Bank Supported Activities
• BP 17.55 Inspection Panel
  

To access the complete set of World Bank Polices, visit their website at http://www.worldbank.org and look for their Operations Policy Manual. The InfoShop in Washington and local Bank offices in the Bank's borrowing countries should also have complete copies of all of the policies available to the public.

Who Has Responsibility For Implementing The Safeguard and Other Bank Policies?

First, the Bank's Board of Executive Directors is responsible for approving all Bank policies and for ensuring that staff implement them and that borrowing governments comply with them. Second, the policies are intended to be implemented within the Bank's operations, which are carried out primarily under the purview of the six Regional Vice Presidencies. These are, currently:

• Latin America and the Caribbean: David DeFerranti
• Middle East and North Africa: Kemal Dervis
• Europe and Central Asia: Johannes Linn
• South Asia: Mieko Nishimizu
• East Asia and Pacific: Jean-Michel Severino
• Africa: Callisto Madavo and Jean-Louis Sarbib
  

Third, within these regional vice presidencies, Bank staff are responsible for ensuring that the operations that they are in charge of-including all project and sector loans-comply with all Bank policies, whether they fall into the category of "safeguard" or not. Staff that are in charge of specific loans are called "Task Team Leaders," and it is these people who are responsible for ensuring that the loans that they negotiate with governments comply with the policies. Finally, the Borrowing Governments have the responsibility to implement the policies in order to qualify for loans. Most Bank policies delineate which elements of the policies the borrowers are specifically responsible for implementing.

TABLE 1.
WORLD BANK SAFEGUARD POLICIES AND CONVERSION PROCESS

Policy	Key Features	Conversion Status
OP/BP/GP 4.01 Environmental Assessment	potential environmental consequences of projects identified early in project cycle EAs and mitigation plans required for projects with significant environmental impacts or involuntary resettlement EAs should include analysis of alternative designs and sites, or consideration of "no option" requires public participation and information disclosure before Board approval	Approved January 1999
OP 4.04 Natural Habitats	prohibits financing of projects involving "significant conversion of natural habitats unless there are no feasible alternatives" requires environmental cost/ benefit analysis requires EA with mitigation measures	Approved October 15, 1995
OP 4.36 Forestry	prohibits financing for commercial logging operations or acquisition of equipment for use in primary moist tropical forests	Conversion incomplete
OP 4.09 Pest Management	supports environmentally sound pest management, including integrated pest management, but does not prohibit the use of highly hazardous pesticides. pest management is the borrower's responsibility in the context of a project's EA	Conversion complete
OD 4.30 Involuntary Resettlement	implemented in projects which displace people requires public participation in resettlement planning as part of EA for project intended to restore or improve income-earning capacity of displaced populations	Conversion incomplete
OD 4.20 Indigenous Peoples	purpose is to ensure indigenous peoples benefit from Bank-financed development and to avoid or mitigate adverse affects on indigenous peoples applies to projects that might adversely affect indigenous peoples or when they are targeted beneficiaries requires participation of indigenous peoples in creation of "indigenous peoples development plans"	Has not been converted; the Bank is consulting with indigenous peoples and NGOs prior to changing the policy
OPN 11.03 Cultural Property	purpose is to assist in the preservation of cultural property, such as sites having archeological, paleontological, historical, religious and unique cultural values generally seeks to assist in their preservation and avoid their elimination discourages financing of projects that will damage cultural property	To be issued as OP/BP/GP 4.11
OP/BP 4.37 Safety of Dams	applies to large dams (15 meters or more in height) requires review by independent experts throughout project cycle requires preparation of EA and detailed plans for construction and operation, and periodic inspection by the Bank	Conversion complete
OP/BP/GP 7.50 Projects on International Waterways	covers riparian waterways that form a boundary between two or more states, as well as any bay, gulf, strait or channel bordered by two or more states applies to dams, irrigation, flood control, navigation, water, sewage and industrial projects requires notification, agreement between states, detailed maps, feasibility surveys	Conversion complete
OP/BP 7.60 Projects in Disputed Areas	applies to projects where there are territorial disputes present allows Bank to proceed if governments agree to go forward without prejudice to claims requires early identification of territorial disputes and descriptions in all Bank documentation	Approved November 1994

NOTES:

4. In the 3/15/96 memo, Myrna Alexander stated, "our experiences with the Inspection Panel are teaching us that we have to be increasingly careful in setting policy that we are able to implement in practice".

5. NGOs have analyzed the Pest Management, Resettlement, and Environmental Assessment Policies. For more information about these analyses, contact BIC.