Project Finance Goes Green

The move towards becoming "green" has continued to gain momentum in different sectors of the business world. Signatory banks throughout the world have taken up the call to become environmental stewards and to promote socially responsible development by adopting voluntary principles known as the Equator Principles, and becoming Equator Principles Financial Institutions.

The Equator Principles are a voluntary set of standards for determining, assessing and managing social and environmental risk in project financing. Equator Principles expressly incorporate a number of the policies and guidelines of the International Finance Corporation (IFC) of the World Bank Group. Equator Principles have become the standard for most banks and investors on how to deal with potential social and environmental effects of projects requiring finance. By adopting the principles, EPFIs undertake to develop individual internal practices and policies consistent with the framework.