Performance Standards Community of Learning

In April 2006, IFC reinforced a long-standing commitment to sustainability by adopting a new Sustainability Policy and Performance Standards for managing environmental and social risk.

IFC Performance Standards became a globally recognized good practice in dealing with environmental and social risk management. In the financial markets worldwide, the Performance Standards have been catalyzing the swift convergence of standards for cross-border project finance.

To date, over 60 banks and financial institutions, including those from emerging markets, have adopted the Equator Principles, which were updated to refer to the new Performance Standards in 2006. The principles are estimated to cover nearly 90 percent of global, cross-border project finance. In addition, 32 export credit agencies of the OECD countries also benchmark private sector projects against the Performance Standards, and MIGA has recently adopted the Performance Standards for its operations. At the same time, while not adopting the Standards in their entirety, some multilateral institutions are looking to achieve "Standards equivalence" in their latest policy updates.

Financial Institutions that use the Performance Standards in their lending should be able to better assess, mitigate, document and monitor the credit risk and reputation risk associated with financing development projects, improve quality of project portfolio, improve brand, reputation, and stakeholder engagement mechanism. Participation in IFC's Community of Learning allows these financial institutions to draw on IFC expertise in applying Performance Standards as well as benefit from knowledge sharing within a wide network of practitioners.