Our approach and performance

As a signatory to the Equator Principles Financial Institution, ANZ commits to implementing the Equator Principles in internal environmental and social policies, procedures and standards for financing projects and will not provide Project Finance or Project-Related Corporate Loans to projects where the client will not, or is unable to, comply with the Equator Principles.

About the Equator Principles

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.

The Equator Principles were established in 2003 by a group of project financing banks and in association with the World Bank's International Finance Corporation (IFC). The Equator Principles have be subsequently updated in 2006 (EPII) and 2013 (EPIII). They have been adopted by 78 financial institutions in 35 countries, 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

Projects assessed as being within the scope are evaluated against the Equator Principles, including 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.

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.

Our performance

2013 results

2013 results

Projects reviewed

In 2013, we reviewed a total of 21 projects under the Equator Principles - all of which conformed with the Principles1. Seven projects assessed and approved in the 2013 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. Two projects were reviewed in the 2012 financial year but were not financed until the 2013 financial year.

Category* Reviewed Conformed to EP Financed
A 1 1 0
B 16 16 12
C 4 4 2
Total 21 21 14

Location of projects

Category Projects in high-income OECD countries Projects outside high-income OECD countries
A 0 1
B 15 1
C 3 1
Total 18 3

Projects reviewed by sector

Category Natural resources Infrastructure Power and utilities Diversified
A 1 0 0 0
B 5 4 7 0
C 0 2 0 2
Total 6 6 7 2

The future
We maintain our commitment to assess all large project finance proposals using the Equator Principles. 

*Category:
A: Projects with potential significant adverse social or environmental impacts that are diverse, irreversible or unprecedented;
B: Projects with potential limited adverse social and environmental impacts that are few in number, generally site-specific, largely reversible and readily addressed through mitigation measures; and
C: Projects with minimal or no social or environmental impacts.

1. Equator Principles II (2006)

2012 results

2012 results

Projects reviewed

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.

Category* Reviewed Conformed to EP Financed
A 1 1 1
B 10 10 7
C 9 9 6
Total 20 20 14
Location of projects
Category Projects in high-income OECD countries Projects outside high-income OECD countries
A 1 0
B 9 1
C 9 0
Total 19 1

Projects reviewed by sector

Category Natural resources Infrastructure Power and utilities Diversified
A 1 0 0 0
B 5 4 7 0
C 0 2 0 2
Total 6 6 7 2

The future
We maintain our commitment to assess all large project finance proposals using the Equator Principles. 

*Category:
A: Projects with potential significant adverse social or environmental impacts that are diverse, irreversible or unprecedented;
B: Projects with potential limited adverse social and environmental impacts that are few in number, generally site-specific, largely reversible and readily addressed through mitigation measures; and
C: Projects with minimal or no social or environmental impacts.

2011 results

2011 results

Full year results: 1 October 2010 - 30 September 2011

Projects reviewed

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.

Category* Reviewed Conformed to EP Financed
A 1 1 1
B 13 13 12
C 8 8 36
Total 22 22 19
Location of projects
Category Projects in high-income OECD countries Projects outside high-income OECD countries
A 0 1
B 10 3
C 8 0
Total 18 4

Projects reviewed by sector

Category Natural Resources Infrastructure Power and utilities Diversified
A 1 1 0 0
B 3 3 5 2
C 0 4 0 3
Total 4 8 5 5

The future

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.
 
*Category:
A: Projects with potential significant adverse social or environmental impacts that are diverse, irreversible or unprecedented;
B: Projects with potential limited adverse social and environmental impacts that are few in number, generally site-specific, largely reversible and readily addressed through mitigation measures; and
C: Projects with minimal or no social or environmental impacts.

2010 results

2010 results

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.

Projects reviewed

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.

Category Reviewed Conformed to EP Financed
A 2 2 1
B 12 12 11
C 7 7 5
Total 21 21 17
Location of projects
Category Projects in high-income OECD countries Projects outside of high-income OECD countries
A 0 2
B 10 2
C 6 1
Total 16 5
Projects reviewed by sector
Category Natural resources Infrastructure Power and utilities Diversified
A 2 0 0 0
B 3 5 3 4
C 1 0 2 1
Total 6 5 5 5

The future

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.

2009 results

2009 results

Full year results: 1 October 2008 – 30 September 2009

Projects reviewed

Categories Reviewed Conformed to EP Financed
A 1 1 1
B 6 6 3
C 4 4 5
Total 11 11 9

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

Categories Projects in high income OECD countries Projects outside high income OECD countries
A 0 0
B 1 0
C 0 0
Total 1 0
Projects reviewed by sector
Categories Natural resources Infrastructure Power and utilities Diversified
A 0 1 0 0
B 1 1 4 0
C 0 3 1 0
Total 1 5 5 0

The future

ANZ maintains its commitment to assess all large project finance proposals using the Equator Principles.
 

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