Enhancing complaints mechanisms of European development finance institutions
Nadia Ashraf, Karim Karaki and San Bilal set out to better understand and highlight good practices among development finance institutions’ complaint mechanisms and discuss some of the challenges linked to their operationalisation.
In the dynamic landscape of development cooperation, international finance institutions (IFIs) and development finance institutions (DFIs) are playing an increasing role in supporting the implementation of policies. In doing so, they operate in challenging contexts involving sometimes significant sustainability risks and impacts. To address these risks and foster their development impacts, DFIs have put in place complaint mechanisms, which can be used notably by people affected by projects financed by DFIs. These mechanisms offer a platform to raise voices on social and/or environmental issues and obtain remediation.
This paper sets out to better understand and highlight good practices among DFI complaint mechanisms, and discuss some of the challenges linked to their operationalisation (including in the case of co-financing). It concludes by presenting a set of recommendations for European DFIs to keep improving their complaint mechanisms.
Given the importance of co-financing between European DFIs, the paper argues that there is a merit in fostering coherence and coordination between complaints mechanisms at the European level, by leveraging the association of European Development Finance Institutions (EDFI). Such a coordinated approach should reflect EU values and principles, therefore serving the objectives of EU policies and strategies, including under the Global Gateway.