A public bank? The EIB's lack of transparency and participation
Despite slow improvements, the EIB remains the least transparent major public international financial institution (IFI). It takes decisions mostly solitarily without inviting or allowing others to be involved – not even those directly affected by them.
A human rights angle
Accessing information held by public bodies is a fundamental human right, set out in Article 19 of the United Nations Universal Declaration of Human Rights.
Applied to the EU, it guarantees the right to "seek, receive and impart information and ideas" from European institutions and thus from the EU's bank – the European Investment Bank (EIB).
This is further reinforced by the Aarhus Convention (ratified by the EU):
EU institutions are not only obliged to disclose environmental information, but also to involve the public "early and effectively" in plans and programmes relating to the environment, at a stage when all options are still open.
The right to information plays a crucial role in promoting participation and democratic accountability. It is an important tool to:
- better achieve lending goals,
- reduce corruption,
- identify potential social, environmental and economic benefits,
- avoid damaging communities and sensitive ecosystems.
Transparency at the EIB
For decades the EIB has remained a closed and non-transparent institution:
- responding mainly to its clients,
- disregarding its duty of transparent and participatory decision-making,
- disregarding the value of information and views coming from stakeholders impacted by and/or interested in its actions.
In February 2010, the EIB adopted a new transparency policy, which improved the access to documents related to EIB projects by treating exceptions (i.e. cases of non-disclosure) more narrowly.
But while hailing its high level of transparency, the EIB in reality does not allow the public or, most importantly, affected individuals to engage fully with decisions regarding its project plans:
Secrecy also after project approval
Even for projects granted hundreds of millions of the EIB's money, the bank's website often publishes little more than a single-line description of the project, the amount sought and the project's sector and country.
Compared to IFI best practice, this suggests an almost embarrassing unwillingness to take seriously “the rights and needs of affected communities and other stakeholders”.
- The new policy does not enable public disclosure of environmental and social appraisal reports before a project is approved. This makes it practically impossible for the public to fully judge a project's impacts at an early stage.
Consequently the EIB often relies only on its own and its clients' potentially biased assessments when deciding where to invest public money.
- Information is not always made available in a timely fashion, hindering for instance affected communities to request changes to a project before it is too late.
The Gazela bridge rehabilitation project in Belgrade for instance, was approved and signed before an obligatory resettlement action plan had been prepared.
- The rationale for a project's eligibility for EIB financing is not provided before final project approval.
We believe the EIB as an EU body, investing public money worldwide, needs to become truly transparent and accountable. This includes publishing all project related documents and taking stakeholders' comments into account. It also would require the EIB to explain the reasons for supporting a particular project and how such support is related to its mission and to the goals of the European Community.
A model transparency policy for the EIB
In 2009, Bankwatch and Client Earth designed an ideal transparency policy for the EIB. It is guided by the principle that, whenever possible, information concerning the bank’s activities will be made public, while recognising that certain public and private interests should be protected through defined exceptions to disclosure.
Read the model policy here (pdf).
Two European public banks are currently reviewing their energy lending policies. We call for an end to coal subsidies.