IFAD’s Environmental and Social Assessment (ESA) Procedures Presentation to the Executive Board Informal Seminar 27 April 2009

2 Part 1. How are environmental issues addressed in IFAD’s Operating Model?

3 Environmental and Social outcomes and the new operating model

4 Why strengthen IFAD’s Environment and Social Assessment Procedures?  Improve portfolio performance – sustainability, risk mgt, results, leadership in rural poverty-environment nexus  Better address emerging areas – food security, climate risk mgt., migration, value chain development, ecosystem markets, land access  Enhance/balance biophysical NRM aspects with social ones – limited participation and analysis of alternatives  Project-oriented approach – limited influence on decision support and strategic vision (upstream)  Former Environmental Assessment Procedures adopted in 1994 (obsolete)

5 Environmental and Social Assessment and Country Ownership  Harmonisation and alignment – Paris Declaration  All projects and programs to fit within government environmental strategies  Country strategies and projects are joint products with governments and other national stakeholders

6 The six Key Success Factors (KSF) domains 1.Country relevance, commitment and partnerships 2.Targeting, gender and participation 3.Best practices and lessons learnt within the context of IFAD’s Strategic Framework 4.Institutional aspects and implementation arrangements 5.Risks and sustainability 6.Innovation, learning and knowledge management

7 Aim of the ESA Procedures To strengthen the mainstreaming of environmental and social issues in IFAD operations  Objectives -Respond to the findings of the Office of Evaluation on environment -Improve resource productivity – pro-poor practices -Protect/enhance access to water resources – multiple use, sanitation -Agro-biodiversity preservation -Expand adaptation and mitigation measures

8 Priorities addressed by IFAD’s ESA procedures 7 priorities 1.Strengthen environment and social integration in the programme cycle 2.Update and develop new tools 3.Promote greater participation of vulnerable and disadvantanged groups in ESA 4.Promote partnerships and harmonisation 5.Accelerate scaling up of local solutions 6.Build staff and partner capacity in ESA 7.Contribute to policy & advocacy

9 Part 2. IFAD’s Environmental and Social Assessment Procedures

10 Most common environmental issues in IFAD projects Biodiversity lossDeforestation/Soil erosion Desertification/land degradation Weather variability/ climate change PollutionWater scarcity

11 Environmental classification  Category A – Irreversible and significant impacts, sensitive areas  Category B – Less significant impacts  Category C –Negligible impacts

12 Environmental trends in IFAD investment projects ( )* Number of projects * Applying 1994 criteria

13 ESA Procedures – process followed  Built on existing IFAD policies and priorities  Draw on IFAD experience and international good practice  Informed by changing context – globalisation, crises, harmonisation, research, public-private partnerships  Identified gaps and opportunities – crossborder issues, cumulative impacts, participation etc.  Extensive consultations Need to shift from reactive, project-focus to broader pro-active upstream

14 Environmental and social values  Vulnerability and adaptation needs for the rural poor  Sustainable use of NR and protection of key ecosystems  Partnership-oriented initiatives  Integrated environmental and social impact assessments  Externalities and minimize social costs  Participatory approaches – emphasis on the role of women  Indigenous peoples and marginalised groups  Environmentally sound agricultural and manufacturing processes  Environmental and social monitoring: projects-at-risk  Strategic Environmental Assessments, where appropriate

15 Challenges addressed by ESA  Tailored to the needs of borrower countries with different capacities  Ensure equitable benefit flow to poorer communities - inclusion, land access & rights  Promote innovative investments -transboundary issues GEF, private sector etc.  Identify/develop positive incentives – collective action on NRM

16 Structure of the ESA procedures  Introduction  Chapter 1 - Environmental and Social Assessment (ESA) procedures -Annexes - Supporting Material for ESAAnnexes - Supporting Material for ESA  Chapter 2 – Strategic Environmental Assessment (SEA) procedures -Annexes - Supporting Material for SEAAnnexes - Supporting Material for SEA  Glossary  References  Operational Statements (11)

17 Priorities addressed by IFAD’s ESA procedures

18  Quality at entry – key entry points for SEA and ESA  Environmental classification –”A”, “B”, and “C”  Comprehensive impact assessments – social, economic and environmental aspects – maximise opportunities  Climate change as cross-cutting issue  Complementarity with existing IFAD policies/tools (gender, learning notes, implementation support) Priority 1: Strengthen environment and social integration in programme/project cycle

19 IFAD’s Quality Enhancement (QE) process Country Strategy Project Design Report Project Concept  Project design Quality Assessment Decision Note EB Approval Loan Negotiations SEAESRN ESIA Report (as necessary) Env. Covenants (where appropriate) SEA = Strategic Environmental Assessment ESRN = Environment and Social Review Note ESIA = Environment and Social Impact Assessment

20 Strategic Environmental Assessment (SEA) in Country Strategy Environmental effects are negligible Conduct SEA Prepare SEA Report Incorporate environmental findings in Country Strategy Consultation Address SEA questions Preliminary screening and scoping Environmental impacts are important Report reviewed Inform policy choices & project development No need for SEA Establish M&E mechanisms Report shared with stakeholders + stakeholder workshop

21 Priority 2: Update and develop new tools  SEA in result-based country strategies and programme development. Pilot test before applying more broadly  Updated 9 Operational Statements - 2 new  Focus on resource accounting, implementation support, monitoring, management plans, risks  Standards on transparency (Project Life Files, disclose environmental information)

22 Priority 3: Promote vulnerable groups participation & benefit flow  Greater community engagement – NGOs, Free Prior and Informed Consent  Identify a range of incentives

23 Priority 4: Promote partnerships and harmonisation  Better safeguard alignment – of national and initiating agencies, as necessary  Enhance cross-sectoral coordination & collaborative efforts –beyond MoE  Address crossborder issues  Pilot use of country systems in ESA

24 Priority 5: Scaling up of local solutions  Step-up innovation: develop/transfer win-win integrated NRM practises and approaches  Focus on ownership, capacity, connection – user groups, CSO, policy  Promote public/private partnerships

25 Priority 6: Build ESA capacity  Build IFAD/partner capacities: poverty- environment nexus, emerging issues, additional staff  Knowledge mgt: learning, monitor outcomes, communication  Cost requirements - help desk, country capacity building

26 Priority 7: Contribute to Policy & Advocacy  Include environmental and social concerns in Country Strategies  Proposed ENRM policy and Climate Change strategy (2010)  Further update of the ESA Procedures (“live document”)

27 Working with Multiple Partners on environment and NRM  Governments  Multilateral Financial Institutions  UN agencies, GEF agencies and Global Mechanism  CGIAR  International Land Coalition and Civil Society Organisations

28 Part 3. Sharing experiences: Mt. Kenya East Pilot Project

29 Case study: Mount Kenya East Pilot Project  In ESSN classified as “A/B” (full EIA required)  Environment Impact Assessment (April 2002): identified need for stakeholder and livelihood analysis

30 Environmental andDesign social issuesconsiderations  Deforestation  Overgrazing  Increased abstraction of water  Soil erosion  Biodiversity loss  Pressure on lower agro-ecological zones  Human-wildlife conflict  Lack of alternative incomes  Weak Governance   CB - NRM   Water Users Associations   Soil and Water Conservation   NR-based IGAs   Co-management of forests   Capacity Building   Rewards for Environmental Services

31 Additional initiatives  GEF grant multi-focal areas in 2006: -Water resource management; environmental conservation; rural livelihoods; strengthening local governance  2 mutually reinforcing grants in Payments for Environmental Services : -Green Water Credits (World Soil Information) -Pro-poor Rewards for Environmental Services in Africa (World Agroforestry Center)

32 I THANK YOU !