Asia Society Policy Institute

Requirements for developers and contractors to strengthen their safeguard systems and improve environmental and social risk management (ESRM) for Asian Development Bank (ADB)–financed projects.

Offers specific requirements to protect the environment and people from projects' potential adverse impacts and to help developers and contractors not only strengthen their safeguard systems but also develop their capacity to manage environmental and social risks.

ADB:

• Supports developers and contractors (originally, “borrowers/clients”) in ensuring the effective application of host countries’ laws and regulations and strengthening project implementation.
• Affirms that the use of host countries’ legal frameworks and governmental institutions by developers and contractors is neither automatic nor mandatory.
  • These frameworks and institutions must not be used for projects considered highly complex or sensitive.
• Considers developers’ and contractors’ efforts to strengthen country safeguard systems (CSSs), practices, and capacity if the developers and contractors commit to doing so.

Developers (and Contractors, where applicable) must:

• Provide relevant environmental information in a timely manner, in an accessible place, and in a comprehensible form and language(s) for affected people and other stakeholders.
• Disclose a draft resettlement plan, as well as an Indigenous peoples planning framework (IPPF).
• Facilitate informed participation and conduct meaningful and ongoing consultations with affected people, civil society, and other stakeholders before making project decisions.
  • The consultation must be held in a space that is gender inclusive and responsive, tailored to the needs of vulnerable groups, and free of intimidation or coercion.
• Establish and inform affected people of a grievance redress mechanism (GRM) to receive and promptly resolve affected people’s concerns/complaints toward the environment, involuntary resettlement, and Indigenous peoples.
  • The GRM must be an understandable and transparent process that is gender responsive, culturally appropriate, and readily accessible at no cost and without retribution.
• Promptly improve or at least restore the livelihoods of all displaced people by using land-based resettlement strategies, replace lost or damaged assets with others of equal or higher value, compensate the cost for assets that cannot be restored, and offer additional revenue and services.
• Provide physically and economically displaced people with assistance. This may include secured tenure to new land before relocation, transitional support and development assistance (including employment opportunities), civic infrastructure, and community services.
• Improve the living standards of the poor and other vulnerable groups if projects displace them.
• Receive consent from affected Indigenous peoples for the proposed commercial development of cultural resources, physical displacement from traditional or customary lands, and commercial development of natural resources within customary lands.

ADB must:

• Assign proposed projects to one of the following three categories based on their potential impacts or risks:
  • Category A projects have significant adverse environmental impacts that are irreversible, diverse, or unprecedented. These impacts may affect an area larger than the sites or facilities subject to physical operations. An environmental impact assessment (EIA) is required.
  • Category B projects have potential adverse environmental impacts that are less severe than those in Category A. These impacts are site-specific, and only a few, if any, are irreversible. In most cases, mitigation measures for these projects are easier to design than those for projects in Category A. An initial environmental examination (IEE) is required.
  • Category C projects have minimal or no adverse environmental impacts. Although an EIA is not required, environmental implications need to be reviewed.
• Screen all projects early to determine if they involve involuntary resettlement or have potential impacts on Indigenous peoples.
• Publicly disclose the EIA or IEE, Indigenous peoples plan (IPP), resettlement plan, and periodic monitoring reports for each project on the ADB’s website.

Developers (and Contractors, where applicable) must:

• Conduct an EIA to determine potential environmental impacts and risks related to projects, including transboundary and global impacts. The EIA report must include the following components:
  • Executive summary.
  • Description of the project.
  • Description of the environment (with comprehensive baseline data).
  • Anticipated environmental impacts and mitigation measures.
  • Analysis of alternatives.
  • Environmental management plan(s).
  • Consultation and information disclosure.
  • Conclusion and recommendations.
• Prepare a resettlement plan for projects that require land acquisition and relocation.
• Prepare an IPP for projects that impact Indigenous peoples.
• Explore alternatives for the location, design, technology, components, and potential environmental and social impacts of each project.
  • Consider the “no project” alternative.
• Submit a draft and final EIA for Category A projects or an IEE for Category B projects to the ADB.
• Submit an updated EIA or IEE and a corrective action plan to the ADB if unanticipated impacts occur.
• Submit environmental monitoring reports to the ADB.
• Submit a social impact assessment (SIA) as part of the resettlement plan and/or IPP.
• Avoid — and where avoidance is not possible, minimize, mitigate, and/or offset — adverse impacts through environmental planning and management.
  • Identify and enhance social and economic benefits that are culturally appropriate, gender inclusive, and intergenerationally inclusive.
• Monitor and measure the progress of implementation of the environmental management plan (EMP), as well as safeguards on involuntary settlement and Indigenous peoples.
• Conduct inspections to verify their own compliance with the EMP and safeguards on involuntary settlement and Indigenous peoples.
• Track progress toward expected environmental and social outcomes and document monitoring results.
• Identify and propose necessary corrective actions in a corrective action plan.
  • Implement corrective actions to mitigate adverse impacts.
• Prepare and submit periodic monitoring reports that describe not only their progress on EMP implementation but also safeguards on involuntary settlement and Indigenous peoples.
  • This should be done in addition to compliance issues and corrective actions.