Our approach and performance
We apply the Equator Principles to all project financing transactions. The Equator Principles are a set of voluntary standards designed to help banks identify and manage the social and environmental risks associated with the direct financing of large infrastructure projects such as dams, mines or pipelines.
About the Equator Principles
The Equator Principles were established in association with the World Bank's International Finance Corporation (IFC) in 2003 and updated in 2006. They have been adopted by 73 financial institutions around the world, covering over 70% of international project finance debt in emerging markets.
The Equator Principles are designed for use primarily in countries with developing legal frameworks. They have particular relevance to ANZ as we are a financier of projects in many emerging Asian and Pacific economies.
By adopting the Equator Principles, we have committed to fund only new projects that can be developed and operated according to sound social and environmental standards.
What the Equator Principles require
A project within the scope of the Equator Principles is evaluated against comprehensive international performance standards (“IFC performance standards”) on issues such as labour and working conditions, natural resource management, pollution prevention, impacts on Indigenous people, community health and safety and cross-cutting themes such as gender and human rights.
Managers of projects with a high social or environmental impact are required to consult with local communities about concerns those communities may have. Following consultation they must then prepare a management and monitoring plan describing the actions needed to adequately mitigate the social and environmental risks of the project.
We are required under the Equator Principles to ensure these steps are carried out in collaboration with our clients.
The principles do not prescribe for a bank what projects it should be involved in and those it should avoid, but rather ensure the bank makes an informed decision, by requiring a thorough analysis of potential social and environmental impacts.
In 2012, we reviewed a total of 20 projects under the Equator Principles - all of which conformed with the Principles. Six projects assessed and approved in the 2012 financial year have not been financed to date, either because the project is not proceeding, or the client is still undecided regarding appointing the financier. One project was reviewed in the 2011 financial year but was not financed until this year.
Projects reviewed by sector
Full year results: 1 October 2010 - 30 September 2011
In 2011, we reviewed a total of 22 projects under the Equator Principles - all of which conformed with the principles. We have financed 19 of these projects, and the remaining three projects are planned for financing in 2012.
Projects reviewed by sector
We maintain our commitment to assess all large project finance proposals using the Equator Principles. In addition, we are playing an active role in the strategic review of the Equator Principles which will further strengthen principles across a range of areas including enhancing transparency of Equator Principle financed projects.
Full year results: 1 October 2009 - 30 September 2010
In 2010, we financed four projects that were approved under the Equator Principles in the 2009 reporting year.
In 2010, we reviewed and approved three projects under the Equator Principles that are yet to be financed. Subsequently, one of these projects did not proceed for financing because the project proponent was not ultimately successful in tendering for the project. The remaining two projects reviewed in 2010 are planned for financing in 2011.
In 2010, we reviewed a total of 21 projects under the Equator Principles - all of which conformed with the principles. We have financed 17 of these projects, and the remaining four projects are planned for financing in 2011.
We maintain our commitment to assess all large project finance proposals using the Equator Principles. In addition, we will also play an active role at an industry level fostering the development and use of the principles in our region by participating in EPFI working groups and outreach initiatives.
Full year results: 1 October 2008 – 30 September 2009
Three projects financed in 2009 were reviewed under Equator Principles and approved in 2008.
Five projects reviewed and approved in 2009 were not financed. Two of these projects did not proceed because the relevant project proponent was not ultimately successful in tendering for the project. The remaining three are planned for financing in the 2010 reporting year.
Location of projects
ANZ maintains its commitment to assess all large project finance proposals using the Equator Principles.
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