Calling the EIB for a state-of-the-art policy on financial intermediaries
EIB Group’s headquarters. Copyright: EIB
Advocacy letter | 25 January 2019
The signatories request the EIB Directors to require from the Bank’s Management to create a state-of-the-art Standard for Financial Intermediaries that will enhance the environmental, social and transparency performance of these operations while maintaining economic benefits. The scale of intermediated operations in the EIB’s portfolio (from 2016 to 2018: EUR 23 billion or 32 per cent of its entire lending in the EU; and EUR 23 billion or 36 per cent of its entire lending in third countries) highlights the need for a sound and ambitious Standard.
By outsourcing part of its lending, the EIB also outsources its due diligence and monitoring. It is assumed that since the final beneficiaries receive relatively small investments, there is limited scope for social and environmental impacts to take place. However, the cases of small hydropower in biodiversity rich areas of the Western Balkans and a recent internal EIB evaluation on intermediary investments in Africa tell a different story.