Newly Released Draft Equator Principles Reflect Greater Focus On Human Rights

The proposed draft of the revised Equator Principles, released on August 13, reflects a greater focus on human rights, with explicit mention of the expectation of human rights due diligence as set forth in the U.N. Guiding Principles on Business and Human Rights. The revised Principles also cover a wider range of project financing structures in recognition of the fact that the project finance market has diversified significantly since the Principles were first released in 2003.

The Equator Principles are a voluntary set of standards for determining, assessing, and managing social and environmental risk in project financing. To date, 77 financial institutions have adopted the Equator Principles, covering approximately 70% of international project finance debt in emerging markets. Financial institutions agree not to provide loans to projects where the borrower will not or is unable to comply with the social and environmental policies and procedures that the institution