By Catherine Cheney
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| Accountability Counsel strategizes with community members in Sindhuli District, Nepal, about a World Bank-funded transmission line. Photo by: Accountability Counsel |
After years of repeatedly raising issues with the World Bank about accountability, Natalie Bridgeman Fields finally had her chance to speak with its president, Jim Kim. She approached him at the Skoll World Forum, following a screening of Bending the Arc, a documentary that follows his path from co-founding Partners in Health to taking one of the most influential positions in development finance. But the conversation did not go as she had hoped.
Fields founded Accountability Counsel to advocate for communities harmed by projects supported by development finance institutions, including the World Bank. In a Q&A following the film, Kim noted that he was once a critic of the World Bank himself, having participated in a protest movement called “50 Years Is Enough.” But when Fields approached him after the session, Kim suggested that groups like hers would prefer the World Bank to shut its doors.
“The communities we partner with just want the bank’s own rules to be followed. That’s all we’ve ever asked for. That’s all we’re asking for now,” Fields told Devex. “We have ideas about how that could be done better, but we can’t do it alone. It’s not a solution unless the bank is leading to make it happen.”
A spokesperson for the World Bank told Devex that: “Internal accountability systems play a crucial role in ensuring that money is used for its intended purposes, as well as to hold wrongdoers accountable. The World Bank has multiple systems in place to ensure accountability across procurement, financial management and disbursement systems.”
Civil society organizations say that development finance institutions may raise the chance of violating their own rules when they invest in higher-risk projects, such as large-scale infrastructure, dams, oil pipelines and mines, and when they invest through financial intermediaries, such as commercial banks and private equity funds.
If the World Bank Group scales from billions to trillions by mobilizing private capital, as discussed in the spring meetings last week, that will only mean more work for the growing number of external groups dedicated to ensuring that institutions established to fight poverty do not harm vulnerable communities through their investments.
“Despite many problems, safeguards in the World Bank Group system are still much stronger than for alternative sources of private finance for many projects,” said Kate Macdonald, a lecturer at the University of Melbourne, whose research has focused on accountability in the international development sector.
She said she sees upsides and downsides in the World Bank scaling up investment in private sector lending. On the one hand, it “creates opportunities for international safeguard processes to exercise greater leverage over projects with high levels of social and environmental risk for affected communities.” On the other hand, “expansion and diffusion of lending portfolios brings significant risks around both transparency and due diligence.”
Diffusion of lending could also lead the World Bank Group to lose leverage over if and how safeguards are implemented, she said.
Kim’s team reached out to Fields to follow up on the conversation at the Skoll World Forum. Last week, she met with several senior World Bank leaders in Washington, D.C, describing it as a more productive conversation than she has had in the past two decades of this work.
Access to justice
Accountability Counsel’s story starts in a remote indigenous village in the Chilean Andes. Fields, then a senior at Cornell University on a summer internship, could never have guessed how the next morning would change her life. The community gathered to protest the building of a dam, which they knew would lead to rising waters flooding their village. When the police arrived, they sprayed the crowds with tear gas.
An activist called out to Fields asking her to tell her government that this was happening, explaining that the United States was funding the dam project through the World Bank.
Throughout her career representing communities in complaints to development finance institutions, Fields learned that people must come together to bring justice to bear.
Motivated by that moment, she went on to become a lawyer with the goal of helping communities like these access justice and bringing accountability to the institutions that, despite being set up to serve them, can sometimes cause them harm. Fields returned to Cornell for a TEDx talk in 2013, where she outlined three insights that led to her understanding of how to deliver on that call to action: people in power aren’t always the most informed; the rules of the game matter; and organizing can level the playing field.
In 1994, the World Bank created a revolutionary new office — the World Bank Inspection Panel — which offers a way for communities to complain, when they believe that rules are being violated. While the bank’s Integrity Vice President investigates allegations of fraud and corruption in operations backed by the World Bank Group — resulting in the blacklisting of more than 500 firms and individuals, a spokesperson told Devex — the World Bank Inspection Panel raises the concerns of communities who feel they have been harmed by those investments to the highest decision-making levels. The office conducts an investigation and issues a report to senior leaders who have the power to change the situation.
After her first year at law school at the University of California, Los Angeles, Fields went to work for the World Bank Inspection Panel, wanting to know whether it worked. But from this experience, and throughout her career representing communities in complaints to development finance institutions, Fields learned that people must come together to bring justice to bear.
Since the launch of the Inspection Panel, other institutions focused on alleviating poverty through development finance have created their own offices for investigation and dispute resolution for projects that negatively impact communities.
But none of this matters unless communities know these mechanisms exist, Fields said. When she launched Accountability Counsel in 2009, it was the first organization focused exclusively on supporting communities to bring complaints to development institutions.
The nonprofit organization raises awareness, works with communities to draft complaints, and gets those complaints to the right people, supporting communities through each step of the process. Headquartered in San Francisco, it has an office in Washington, D.C., where the focus is on policy and advocacy. It also has a number of consultants in South Asia, and plans to open an office in Africa as part of a long-term strategy to grow regionally, to be closer to the communities the organization partners with.
The World Bank’s recent emphasis on scaling up investment in private sector lending heightens the importance of channels for affected people, and civil society organizations with the capacity to support them, to remain strongly engaged, Macdonald said. These groups will need to ensure that safeguards do not become watered down within a changing international political and economic environment; to facilitate and create sustained pressure for more transparency of public international investment flows; to support the effective implementation of safeguards; and to demand redress in cases where they see that safeguards are not being implemented, she added.
Over time, Accountability Counsel has broadened its efforts, for example by working with partners on alternative development resources for communities that have been harmed.
A growing number of groups now represent communities bringing complaints to development finance institutions. Increasingly, they are seeing value in bringing advocates together and sharing experiences across borders.
Advocates joining forces
A lawyer from Liberia went from holding back tears to letting them stream down his face when he recalled the day that a paramilitary working for a multinational company encircled him with guns and machetes, drinking and singing war songs, and saying that they would behead and cannibalize him.
He joined Devex along with Fields at Stanford University in Palo Alto, California, for a small group discussion on the final day of the International Advocates Working Group retreat in February. By 2013, there were enough groups working on accountability in development that it made sense to bring them together through a formal network. The Working Group became a platform for communication with regular meetings and an annual retreat.
“Good development is driven by the needs of the members of community not shoved down their throats.”
— Alfred Brownell, founder of Green Advocates
“We are held captive by transnational corporations,” said Alfred Brownell, the founder of Green Advocates, a Liberia-based nongovernmental organization focused on environmental law. “Those of us who dare stand up to power and speak truth to power and try to defend those communities become targets. They see us as an obstacle. They want to grab the land, they want to abuse the communities, and we say no, you cannot do this.”
From fighting human rights abuses on rubber plantations to representing villagers displaced as a result of land deals for agricultural operations, the cases that raise Brownell’s profile on an international level also increase his security risk at home. He is now living in the U.S., while directing Green Advocates and collaborating with Accountability Counsel. He emphasized that he is not against investment, but against companies making communities worse off, especially when using funding from development finance organizations.
“Waking up in the morning and seeing tractors clearing your land is not development,” he said. “Good development is driven by the needs of the members of community not shoved down their throats.”
A growing number of voices
On Earth Day, Fields emailed Accountability Counsel subscribers about the Caracol Industrial Park in Haiti. The project, part funded by the Inter-American Development Bank, includes a large garment factory complex and heavy oil power plant a short distance from the mangrove and coral reefs of Three Bays National Park. Accountability Counsel published a report pointing to the negative impacts of the industrial park, in particular on women and girls.
“It can be a herculean task to reach a mediation agreement with a powerful corporate client.”
— David Pred, managing director at Inclusive Development International
“I'd say the biggest challenge is that the multilateral development banks enjoy absolute immunity from legal action by people who have been injured by their financing activities,” said David Pred, managing director at Inclusive Development International. “This immunity perpetuates a culture of impunity by development finance institutions to play fast and loose with people's lives in the projects that they finance.”
While the independent complaint mechanisms launched by development banks in recent years have helped to bring more accountability to development, meaningful remedies for the victims of development disasters are rare, he said.
“It can be a herculean task to reach a mediation agreement with a powerful corporate client or to get a strong compliance report from an accountability mechanism that the bank's board actually takes seriously and does something about,” Pred told Devex. “That's why it is so fundamental for communities to have legal and advocacy support in navigating these complex processes, which is what our very small emerging field specializes in.”
Fields said that while external groups need to make sure they deliver, the growth of accountability offices at development finance institutions represents real progress and provides a framework to work on.
Although it has a smaller percentage of global finance relative to other institutions, the World Bank was the first development finance institution to set up both an accountability office and safeguard policies, and has come to be seen as a standard setter at the center of the strategy for organizations wanting to drive change across the world of development finance.
Scott T. Adams, specialist ombudsman for dispute resolution at the Compliance Advisor Ombudsman for the International Finance Corporation and Multilateral Investment Guarantee Agency told Devex that the office “appreciates the contributions [that] civil society organizations make to assist local project-affected communities.”
He added that the office “welcomes ongoing feedback and suggestions from civil society on how to improve our work, and we proactively seek frequent consultation with civil society groups.” Finally, he said, CAO “recognizes and appreciates the efforts of civil society organizations to help inform potentially affected communities around the globe about CAO and how to access our office.”
The way forward
Representatives of civil society organizations say that, particularly because the World Bank can influence other institutions, they welcome recent calls by Kim for a rethinking of development finance.
“For this to be a meaningful shift, it is critical that the bank places people at the center of development, genuinely engaging with communities impacted by bank projects,” said Jeff Hall, executive director at the Bank Information Center, which brings cases to the accountability mechanisms at the banks.
A recent example is a $265 million road project in Uganda, which the World Bank cancelled after Joy for Children Uganda, backed by the Bank Information Center, documented allegations of employees of World Bank contractors sexually abusing minors.
“There are so many Ugandas everyday,” Fields said, echoing comments by her colleagues Hall and Pred that there is more than enough work, and opportunity for collaboration, for the growing number of civil society organizations.
Last week, Fields asked Kim a question at the Global Philanthropy Forum in Washington, D.C., weeks after their first interaction at the Skoll World Forum.
“I wake up everyday feeling that not only are we doing the right thing most of the time but that the task is ever more urgent.”
— Jim Kim, president of the World Bank
“Many NGOs are very upset about the fact that we invest in financial intermediaries. They’ve been very critical of us, but I would strongly suggest that you look very specifically at the projects,” Kim said in response. “The argument is that if we move any money into financial intermediaries, we should use our safeguards with everything that they do. That is logistically extremely difficult. And so the tradeoff, always, is do we provide poor people in Uttar Pradesh with mortgages or do we not?”
This is the most difficult part of the job, Kim said. On the one hand, lower and middle income countries complain that environmental and social safeguards are too strict, but on the other hand, civil society organizations make the opposite argument.
“This is my life, managing the complexity, and I wake up everyday feeling that not only are we doing the right thing most of the time but that the task is ever more urgent,” he said.
The senior leaders from the World Bank who met with Fields in Washington, D.C., last week said that safeguards are the value added that the bank offers in its investments. Fields hope is for a message from the top that accountability offices at the bank are critical to its functioning, and an acknowledgement that they should have better resources and a stronger mandate for their findings to result in less voluntary and more mandatory action.
She said she also wants to see a staff incentive structure aligned to development outcomes, rather than the volume of lending, with concrete evidence of whether the bank is prioritizing safeguards as the value added of being an honest broker.
She looks forward to working with the World Bank on what is ultimately in their shared interest: That these issues are prevented and resolved earlier in the process, so that they do not have to be elevated to the level of the accountability office.
“The World Bank has these mega projects time and time again, and when we see major disasters, we have these periodic wakeup calls that lead to change," Fields told Devex.
“The bank realizing that these are not anomalies but signs of systemic problems that require a proactive not a reactive response, and that civil society is the key to fixing that and not the enemy — that is the way forward.”
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