The Board of Directors of the Asian Development Bank (ADB) is currently reviewing the draft of a proposed Environmental and Social Framework (ESF), which outlines new operational policies to better address environmental and social risks in ADB projects. This proposed ESF seeks to update ADB’s 15-year old Safeguard Policy Statement (SPS) to ensure the relevance of its safeguards to changing needs and context in developing member countries. Civil society organizations are keen to see the ADB adopt new safeguards that promote comprehensive and genuine safeguarding of project-affected communities and the environment. In short, an ESF that truly upholds the principle of “do no harm” in planning, designing, and implementing projects.

By Lidy Nacpil and Rayyan Hassan

Despite the 2009 SPS’s vaunted new approach to avoid, mitigate or minimize adverse impacts on the environment and people, ADB projects have caused irreparable damage to communities and the environment. An Operational Review of the SPS by the ADB’s Independent Evaluation Department (IED) found substantial gaps in safeguards delivery and safeguards failures at the project level due to lack of due diligence. The key problems behind the failure of the ADB’s safeguard policy, according to IED, are lack of meaningful consultation at the project design phase, gaps within Environmental Social Impact Assessments, and a lack of time bound project-related information disclosure to affected communities.

As ADB crafts its ESF, the stakes for safeguarding people, communities, and the environment have never been higher:

Many developing countries are beset with overlapping climate and economic crises that are deepening hunger, poverty, and indebtedness. About 670 million people were estimated to be living in extreme poverty in 2022, an increase of 70 million people. Asia’s poor were estimated to be more than 155 million people, an increase of 67.8 million more after the pandemic, according to ADB. Debt service payments are at an all-time high in 2024. Nearly half of the world’s population now lives in a country that spends more on external debt service than on investments in health or education. If these countries were to invest resources at the levels needed to meet internationally agreed climate and development goals, many of them will become bankrupt in the next five years.

Amid intensifying global conflict and environmental disasters, we are seeing record levels of displacement. Some 76 million people have lost their homes, livelihoods, and communities because of wars and climate and natural disasters, twice the number ten years ago and the largest numbers ever recorded.

Biodiversity is declining faster than at any time in human history. Many ecosystems have now been degraded beyond repair or at risk of collapse with impacts both now and in the future – undermining economies, food security and public health and posing catastrophic consequences for climate-vulnerable developing countries. Scientists estimate that global biodiversity declined by 2 to 11%, largely due to land-use changes, but climate change will be the primary driver of biodiversity loss by mid-century.

The pressure to mine for transition minerals has been intensifying as the world looks to shift away from fossil fuels and transition to renewables. The mining of transition minerals has been linked to hundreds of allegations of abuse with multi-faceted environmental and social impacts, especially on indigenous lands and communities.

For the past two years, civil society organizations have been engaging the ESF review process and the ADB Office of the Safeguards. We have raised concerns on current safeguards gaps and challenges in implementation and formally submitted comments and recommendations. We also voiced our clear stance on strong safeguards for climate impacts, climate-induced migration, projects in disputed lands, cultural impacts, gender impacts, labor standards, just transition, among others.

ADB released the draft policy (ESF W paper) for comments last September. Far from our expectations, the paper proposes a weak ESF that has raised concerns among stakeholders due to the dilution of standards compared to the 2009 SPS. The draft ESF gives more flexibility to borrowers and clients in implementing environmental and social safeguards, which could lead to reduced accountability, inconsistent application of standards, and higher risks of environmental degradation and social harm. The draft ESF also removed several protections established under the 2009 SPS, which diminishes the rights of communities affected by ADB projects, making them more vulnerable to social injustices, conflicts, and forced displacement. Moreover, it eliminated mandatory Environmental Impact Assessments (EIAs) and Social Impact Assessments (SIAs) before ADB board approvals, even for high-risk projects. This may result in inadequate risk assessments and uninformed decision-making, increasing the likelihood of environmental and social harm.

The proposed changes in the draft ESF suggest a significant weakening of the environmental and social standards that have guided ADB projects in the guise of more flexibility. However, the overall effect is less accountability in project implementation, reduced protection of community rights, and inadequate assessment of project impacts. Strong environmental and social safeguards of development institutions, like ADB, are not just important, but critical amid the multiple challenges humanity is facing. We are being destabilized from so many different directions at once. We need progressive, future-proofed safeguards that take into account all forms of social and environmental risks and impacts.

Lidy Nacpil is coordinator of Asian Peoples’ Movement on Debt and Development (APMDD).

Rayyan Hassan is executive director of NGO Forum on ADB.