IDB Speeds Toward Adoption of New Disclosure Policy

4 May 2010

The Inter-American Development Bank has released a proposed disclosure policy and is on a fast track to approve it in mid-May.

The unexpected speed, shortchanging plans for a public consultation period, was motivated by a desire to bolster its case for a capital increase. The Board of Governors in March set a number of conditions on itself, including approval of a new disclosure policy, to help win international support for May approval of a capital increase agreement.

The governors instructed IDB Management “to implement a new disclosure policy that meets the highest standards applied by other Multilateral Financial institutions including the following elements:

  • The replacement of a “positive list” of disclosed policies with a limited “negative list”
  • Presumption of disclosure
  • Release of Board/Committee minutes
  • Independent appeals mechanism
  • Voluntary disclosure of ED’s statements
  • Disclosure of project-level results

The draft issued April 26 tracks the new information policy recently adopted by the World Bank.

A background paper outlines the origins of the IDB policy, provides a chart comparing its proposal with the policies of other international financial institutions and includes a list of new documents that would be disclosed.

The 13-page draft policy, like the Bank policy, moves in the direction of presuming disclosure, subject to exceptions.  Nondisclosure would be justified under any of 10 exceptions. The draft also includes an extensive “Annex I” going into detail on documents specifically excluded from the policy.

The exceptions provide blanket protection for  materials that are part of the “deliberative process.”

Simultaneous Disclosure Included

Under the proposal, however, the IDB would follow the World Bank in allowing the simultaneous release of certain “draft” documents as they are sent to the Board of Executive Directors, or a key committee, for consideration, usually two weeks before Board deliberation. The list of documents to be circulated  includes draft country strategies, sector strategies, operational policies and loan proposals, and technical cooperation plans of operation (the later only involving resources of more than $1.5 million).

However, such “simultaneous disclosure” could be limited. Affected governments could object to the release of such so-called draft documents without reference to the exceptions.

New Appeals Process

The proposal includes a new appeals mechanism, with two panels, one internal for initial reviews and another composed of “external” to hear subsequent appeals.

Another provision would allow the Bank to override its disclosure policy in two situations: if the harm of disclosure outweighed the benefits, or if the benefits outweighed the potential harm. The proposed three-person external review board, however, would not be empowered to consider appeals of such decisions.

One element in the proposed IDB policy, as mandated by the Governors, goes beyond the World Bank policy. It would permit Executive Directors to release their own statements.

Annex I Trumps Exceptions List

The three-page Annex I goes into detail about what will not be released, naming specific documents.

The section aimed at protecting “deliberative” information, for example, would prohibit release of “sections of the Progress Monitoring Report (PMR) other than those related to the status of projects in execution.”

Another section of the annex indicates that other information about post-approval operations would not be disclosed. The “country-specific information” section would prohibit disclosure of “portions of aides-memoire that contain key decisions taken as a consequence of supervision missions.”

In both of these cases, the goal is to allow the release of “factual” information, but not of the recommendations of IDB staff.

Annex II Limits Disclosures About Private Sector Lending

The proposal does not permit much disclosure about the IDB’s growing portfolio of private sector lending, so-called non-sovereign guaranteed operations.  They are not covered by the simultaneous disclosure policy, for example.

The general presumption of non-disclosure, however, is mitigated by a seven-point list contained in Annex II.

Information to be Disclosed in connection with Non-sovereign Guaranteed operations

  • Initial Project Abstracts
  • Environmental and Social Strategies (ESS)
  • Environmental Impact Assessments (EIA)
  • Strategic Environmental Analyses (SEA)
  • Environmental Analyses (EA)
  • Environmental and Social Management Reports (ESMR)
  • Abstracts of Approved Projects

The Bank does not have explicit timelines for disclosure of such documents, but a “clarification” in the background paper provides some addition guidance. Among other things, the clarification states, “Access to this information should be provided as early as possible in the project cycle. And in all cases prior to the analysis (or due diligence in the case of non-sovereign guaranteed operations) phase of project preparation.”

By Toby McIntosh

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Filed under: IFTI Watch


In this column, Washington, D.C.-based journalist Toby J. McIntosh reports on the latest developments in information disclosure in International Financial and Trade Institutions (IFTI).
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