Equator Principle 3
Equator Principle 3: Applying required Environmental and Social Standards
Principle 3 concerns applying required Environmental and Social Standards. The Assessment process should, in the first instance, address compliance with relevant host country laws, regulations and permits that pertain to environmental and social issues.
EPFIs operate in diverse markets: some with robust environmental and social governance, legislation systems and institutional capacity designed to protect their people and the environment; and some with evolving technical and institutional capacity to manage environmental and social issues.
The EPFI’s due diligence will include, for all Category A and Category B Projects globally, review and confirmation by the EPFI of how the Project and transaction meet each of the Principles.
The EPFI will, with supporting advice from the Independent Environmental and Social Consultant where applicable, evaluate the Project’s compliance with the applicable standards as follows:
- For Projects located in Non-Designated Countries, compliance with
- the applicable IFC Performance Standards on Environmental and Social Sustainability (Performance Standards) and
- the World Bank Group Environmental, Health and Safety Guidelines (EHS Guidelines) (Exhibit III).
- For Projects located in Designated Countries, compliance with relevant host country laws, regulations and permits that pertain to environmental and social issues.
The review of the Assessment process will establish, to the EPFI’s satisfaction, the Project’s overall compliance with, or justified deviation from, the applicable standards. The applicable standards (as described above) represent the minimum standards required by the EPFI.
In addition, for Projects located in Designated Countries, the EPFI 5 will evaluate the specific risks of the Project to determine whether one or more of the IFC Performance Standards could be used as guidance to address those risks, in addition to host country laws.
The EPFI may, at its sole discretion, undertake additional due diligence against additional standards relevant to specific risks of the Project and apply additional requirements.
