“Broad Community Support”- IFC’s Current Practice

1. “Broad Community Support”-IFC’s Current Practice October 9, 2008

2. Background • Part of WBG EIR Management Response for all extractive industry projects • Evolution to FPIConsultation • Expressed in WB IP Policy & IFC’s Sustainability Policy • IFC’s implementation began in 2006 • Trigger = FPIConsultation • FPIConsultation is triggered by: • potential significant adverse impacts on affected communities or • adverse impacts on Indigenous Peoples • not necessarily Category A projects • Also all extractive industries projects whether As or Bs with significant impacts on communities or adverse impacts on IPs

3. Broad Community Support (BCS): Definition in IFC Sustainability Policy • …IFC reviews the client’s documentation of the engagement process. In addition, through its own investigation, assure itself that the client’s community engagement is one that involves free, prior and informed consultation, and enables the informed participation of affected communities, leading to broad community support for the project within the affected communities... • Broad Community Support is a collection of expressions by the affected communities, through individuals, and/or their recognised representatives, in support of the project. There may be broad community support even if some individuals or groups object to the project.

4. Focus on FPIC Process (client responsibility) IFC reviews the client’s FPIC process by focusing on: • How the client carried out the process of free, prior and informed consultation and informed participation of affected communities • How the affected communities were defined • Within project’s area of influence, those most directly affected both positively and negatively • Identified through stakeholder identification process • The client’s written record of disclosure and consultation • Follow up records- showing client responding to concerns • Grievance mechanism – structure, procedure, and application

5. BCS: Ascertaining Support for the Project IFC asks: • What is the level of support / dissent among the affected communities for the project (all types of expressions –formal, informal, evidence of specific agreements, keeping commitments, etc)? • Whether community expressions are “in support of the project” as opposed to lack of opposition to the project Note: Objections by some members of the affected communities will not necessarily negate BCS

6. Ascertaining BCS continued: • Opinion polls may have limited value and pose a range of other problems (competing polls, interpretations of some negative conclusions, etc) • Client may sometimes use perception surveys to pose questions to affected communities and solicit their response • Outreach and CD programs for affected community do not necessarily equal BCS • Net benefit analysis • Certification to the board by Director CES and Director of relevant investment department

7. BCS Practice: Range of IFC Experiences • To date 18 projects with FPIC/BCS (as of end of August 08) • 11 Category As (out of 11) • 7 Category Bs (out of 232) • 10 are extractive sector projects • All Category B projects with FPIC/BCS are in the extractive sector

8. Implementation Challenges • Challenges in projects that are not defined until later • Early equity • Facilities • Considering how to build BCS into IFC supervision process • In expansion projects, it is sometimes difficult to separate community’s appreciation of outreach/charity programs from community’s positive expression of support for the proposed project

9. The Performance Standards Update Process • Phase One: Internal stocktaking, data generation and 3rd year report to Board • To end of FY09 • Phase Two: Reviews by the External Advisory Group; CAO & IEG • From 3Q FY09 to 1Q FY10 • Phase Three: Board and external engagement on IFC policy update proposal • 2Q FY10 to 4Q FY10