AFD // 2021 Universal Registration Document

STATEMENT OF NON-FINANCIAL PERFORMANCE 2 Managing the risks and impacts of our action

2.3.2.2 Proparco system for processing complaints Since 2019, Proparco has had an environmental and social complaints processing system that gives any person or group of people who feel adversely affected by the environmental or social aspects of a project financed by Proparco the opportunity to file a complaint and be heard by independent experts (1) . This is a joint initiative by Proparco and its German and Dutch counterparts, DEG – the German private sector bilateral development bank, member of the KfW group – and FMO – the Dutch private sector bilateral development bank. If the complaint does indeed concern a project funded by Proparco, if the complaint does not correspond to one of the exclusion cases specified in the System’s documentation, and if the complaint file is complete (complying with the contents described on the Proparco website), it is sent to a panel of independent experts who first of all give a ruling on its eligibility, in compliance with the System’s regulations. Once a complaint has been declared eligible, two processing methods are offered: P a compliance audit, in which the panel of independent experts will examine whether the project financing was implemented according to the applicable rules in terms of compliance and Proparco’s internal policies;

P reconciliation, aiming for the out-of-court settlement of a dispute between the complainant and the recipient of the funding. Proparco then offers mediation services, but is not involved in the mediation process. In the second case, the panel will work with the plaintiff and the project sponsor to develop an appropriate process to deal with the problems raised by the complaint. This may include information sharing, discussion support, or mediation to find a solution acceptable to all parties. The panel of independent experts does not then adopt a position concerning the truthfulness of the allegations, and will not seek to determine liability or to impose a solution. In certain particular cases, the two approaches can be combined. The process is considered to be complete when an agreement is reached between the parties when resolving a dispute, or when establishing final recommendations by the expert panel in the case of a compliance audit. An action plan is then proposed, the implementation of which is monitored by the complaints office and the expert panel. The very first Proparco complaint was received inNovember ɸ 2020 and closed in 2021. As this complaint corresponded to a purely operational dispute, it was generally considered that addressing it outside the system, as proposed by the panel of experts, was preferable. A new complaint was declared admissible by the panel in July ɸ 2021. Mediation between the various stakeholders is ongoing, with the support of the panel of experts.

Under analysis or being processed

Year

Received

Closed

2019 2020 2021

0 1 1 2

0 0 1 1

0 1 0 1

TOTAL

To do so, the AFD Group relies on the performance standards of Société Financière Internationale (SFI) (2) , on the environmental and social standards and the environmental, health and safety Directives of the World Bank, as well as on the fundamental conventions of the International Labour Organization (ILO) (3) . The human rights issues covered by these standards enable us to address matters related to: P workers’ rights: namely working and employment conditions, and the protection of the workforce (and notably against forced labour or child labour, discrimination, ɸ etc.); P the rights of communities, in particular the health and safety of communities potentially affected by projects (and notably potential violence against these communities); land acquisition and involuntary resettlement (notably to avoid forced evictions);

An initial assessment of the joint DEG, FMO and Proparco system will be conducted in 2022 and published on the three sites. 2.3.3 Human Rights due diligence The AFD Group operates in countries where human rights are not always fully respected, even if these countries formally adhere to treaties and conventions governed by international human rights law. The mandatory due diligence in the field of operations includes the assessment of the social risks of the projects financed. The issue of applying international human rights standards is thus constantly on the agenda and integrated into the assessment and implementation of all projects, whatever the shape or form.

(1) https://www.proparco.fr/en/icm (2) https://www.ifc.org/wps/wcm/connect/corp_ext_content/ifc_external_corporate_site/home (3) https://www.ilo.org/global/lang--en/index.htm

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2021 UNIVERSAL REGISTRATION DOCUMENT