Use the upstream experience gained by IFC's advisory and investment operations to mitigate project risks and assist with community and company relations as IFC moves its investments upstream. Adjust skills accordingly.
As IFC seeks to move its investments upstream - as envisioned in its 2010 Strategy Update - there are several lessons that can be learned from its operations with regard to land and resource rights and claims and about stakeholder engagement. In particular, linking IFC's Advisory Services with investments can help in mitigating social risks and enhance development results.
Original Response: Agreed: IFC recognizes that a wealth of community/land rights knowledge has already been gained by IFC through its investment programs and recent advances in AS programs. IFC's enhanced focus on linked AS and IS projects will facilitate consultation and participation of communities in forestry investments.
IFC Action 6: Lessons learned from advisory projects with significant community impacts incorporated into investment decisions/investment lessons learned incorporated into advisory decisions
Indicator: Inclusion and incorporation of lessons learned in IFC appraisals
Baseline: No evidence of advisory/investment cooperation incorporation
Target: 100% of all land/community sensitive projects include knowledge sharing between advisory and investment teams where relevant
Timeline: Verified by June 2014
IEG notes that the new reconfiguration - which has merged AS with IS - lends itself much better to mainstreaming support for land and resource rights into the investment services. The ongoing work in Mozambique and China are good examples of uptake of the IEG Forest Evaluation recommendation.
Advisory Services have now been mainstreamed into the Investment Departments at IFC thus the AS linkages with Investment projects has become more direct. This is particularly the case in forestry and agriculture. The following Forestry and Wood Products Investments have included direct support from AS during FY2016.
Portucel/Mozambique has developed an extensive and substantial AS program which supports the client in (1) development of agriculture extension support (2) Baseline stakeholder assessment and engagement services (3) development of new tools and approaches for community land registration (organization of an NGO council to assist the company in it stakeholder engagement and communications. (see Portucel/AS Work Program).
Lessons learned from Stora Enso/China are now being packaged and adapted through an AS contract with Stora Enso's operations in PDR Laos focused on stakeholder engagement and communication strategies with ethnic minority communities. Reciprocally, lessons learned from Stora Enso/Guangxi are now being included in both AS and IS activities in Portucel/Mozambique. ((see ESRS/ESAP and AS Work Program for Portucel).
AS support for proactive stakeholder engagement and communications training for all GEF/Africa Sustainable Forestry Operating Companies was acknowledged in recent IEG Project Performance Assessment Report (IEG, 2016).
IFC Investment and Advisory programs are working together in several other countries in emerging forestry activities including Sierra Leone (biomass), Ethiopia (forestry development), Gabon (WBG Forest Investment Strategy), Colombia FIP development, Nepal FIP development, Indonesia FIP development and Kenya Tea Estate outgrower biomass development. (refer to WB and IFC respective reports).
The IFC Target indicated that 100% of all land/community sensitive projects would include knowledge sharing between advisory and investment teams. The two projects cited do not provide evidence that the target is being met. Does the list provided last year, plus these new investments, represent 100%? It is not clear from the management update. Moreover, the evidence provided should describe how applying knowledge from IFC's advisory service experience has mitigated risk, for example, in the Mozambican context. A Category A project (that experienced a delay in providing the necessary Category A Safeguard documentation), the MAR response should speak to the identified risks (environment and social) and the measures that are being put in place to mitigate these risks, and to enhance development results..
Two recent plantation investments in particular Stora Enso in China and Portucel in Mozambique clearly demonstrate application of lessons and experience derived from previous land intensive forest sector investments. Manifestations of this integration can be seen in the upfront consultation processes followed, inclusiveness and benefit sharing, and remedial measures taken to rectify earlier shortcomings affecting local communities/suppliers.
(note: Mark Constantine and Leoplodo Sposato have completed reviewed and cleared the update and ratings for this recommendation as Task Leader and Reviewing Manager and have authorized Kris Luniku to clear in the system on their behalf).
IFC Management committed to integrate lessons learned from advisory projects with significant community impacts incorporated into IS and AS decisions. It proposed the indicator âInclusion and incorporation of lessons learned in IFC appraisals with a baseline of âNo evidence of advisory/investment cooperation incorporationâ and a target of 100% of all land/community sensitive projects including knowledge sharing between advisory and investment teams where relevant. These efforts should be verified, according to IFC Management by by June 2014.
IFC Management rated this recommendation active and its performance Substantial based on the evidence that âAdvisory and Investment teams working increasingly jointly when appropriate with examples provided for Sumitomo/Vietnam, Sumitomo/Indonesia, Stora Enso/Laos, Mozambique/Portucel, GEF Africa Sustainbility Forestry Fund, and New Forests/Tanzania.
IEG agrees that this recommendation has had Substantial uptake and should remain active. IEG would appreciate knowing more about how these engagements have helped mitigate some of the land and forest resource related risks that IEG pointed to in the Forest Evalaution.
Advisory and Investment teams working increasingly jointly when appropriate.
Examples include: Sumitomo/Vietnam, Sumitomo/Indonesia, Stora Enso/Laos, Mozambique/Portucel, GEF Africa Sustainbility Forestry Fund, New Forests/Tanzania.