Three years ago, 10 financial institutions — with Citigroup the only United States company on the list — announced that they would abide by the Equator Principles, a set of standards intended to ensure that the large projects they financed did not have a harmful impact on the environment or local population.

Since then, the Equator Principles Financial Institutions, as the group calls itself, has swelled to 41 members across the globe, including three more American companies: Wells Fargo, J. P. Morgan Chase and Bank of America. And today the group is expected to announce an expanded version of its guidelines as well.

The new principles will apply to any project with a capital cost of more than $10 million, down from $50 million in the original version, as well as to upgrades and expansions of older projects.

The expanded principles require an institution s financial advisers to vet new projects for environmental and social impact when they are being designed, rather than wait until they actually apply for financing. They also now include guidelines for labor practices on projects, and require institutions to report publicly on their processes for complying with the principles.

The original Equator Principles adopted most of the guidelines set by the International Finance Corporation, the World Bank s private-sector arm. That group recently expanded its own guidelines, and the financial institutions have adopted those as well.

"The principles created a de facto global standard for the project finance business, and keeping the I.F.C. policies as their core helps maintain that benefit of global consistency," said Pamela P. Flaherty, Citigroups senior vice president for global community affairs.

The new principles stop short of requiring financial institutions to publicize details of projects, which disappointed some environmentalists. "They still have to find a better balance between their concerns about client confidentiality and the need to demonstrate that projects really are environmentally and socially sound," said Jon Sohn, a senior associate at the World Resources Institute, an environmental group that was consulted when the original principles were drawn up.

Still, Mr. Sohn applauds the revisions that were made. "They are acknowledging that the impact of a project doesnt have anything to do with its size, and it looks like they are really creating better mechanisms for local communities to have their say before projects go forward on their land," he said.
(Por Claudia H. Deutsch,The N.Y.Times, 06/07/2006)