The Bloomberg BNA (BBNA) Capstone team analyzed potential gaps between select U.S. regulations and the International Finance Corporation’s Performance Standards (IFC PS) on assessment and management of environmental and social impacts and risks (PS1), biodiversity conservation (PS6) and indigenous peoples (PS7), as a prototype for potential inclusion of similar benchmarking tools in BBNA’s products and services.

The IFC PS provide a framework for environmental and social risk management (ESRM) that are used by the IFC and members of the Equator Principles, a voluntary risk management system adopted by global financial institutions, in assessing credit risks and creating contractual obligations as conditions for projects/transactions financing. The goal of this Capstone was to investigate instances where the IFC PS provided a more robust standard of guidance than the select U.S. regulations for companies, institutions, and stakeholders working on relevant projects in order to meet global best practices. As such the objectives of the overall study were threefold: (1) to benchmark U.S. regulations against the relevant IFC PS; (2) to create a gap analysis tool comparing U.S. regulations and the IFC PS; (3) to provide high-level good industry practice recommendations for selected gaps.

The Alaska LNG Project, currently undergoing permitting by the Federal Energy Regulatory Commission, was used as a reference case study to help identify relevant U.S. regulations for benchmarking purposes against selected IFC PS. Further analysis of how this case
study would be treated by the ESRM standards of the IFC PS and U.S. regulations were included in the final deliverables.