Reassessing the Prospects of a Human Rights Safeguard Policy
at the World Bank
Suzanne Zhou
1. Introduction
For much of its history, the World Bank has been criticised for taking an approach to
development overly focused on economic growth at the expense of social and
environmental concerns, and in particular, for ignoring the human rights impact of its
projects. Over the last 20 years, however, it has been increasingly willing to engage with
the question of how human rights concerns affect its work, with this engagement
intensifying in the last five years with the establishment of the Nordic Trust Fund and a
number of World Bank studies in the use of international human rights concepts in Bank
policy. Despite these developments, significant legal and institutional obstacles, including
the prohibition on political interference in its Articles of Agreement,1 have meant that
engagement with human rights at the Bank remains largely ad hoc, informal, and
independent of the international law on human rights, a fact that continues to fuel
criticism of the Bank.2
A frequent suggestion arising from such criticism is that the Bank should adopt a formal
human rights safeguard policy, incorporating norms drawn from international human
rights law, for its public sector lending arms, the International Bank for Reconstruction
and Development (‘IBRD’) and the International Development Association (‘IDA’).3
This article examines whether existing social safeguard policies at the World Bank could
be subsumed into a comprehensive human rights based safeguard policy of this type, and
the possible ways of accommodating such a policy within the constraints set by the
Bank’s constitutive documents. It argues that while the Articles of Agreement are no
longer seen to automatically exclude all human rights concerns, they continue to
constrain the potential form of a human rights safeguard policy. Additionally,
institutional obstacles which limit the desirability of adopting a policy and the
effectiveness of such a policy if adopted remain. These include concerns over the
appropriateness of having the Bank impose human rights conditionalities, internal
incentive structures that cause pressure to lend, and the difficulty of enforcing safeguard
policies through the Bank’s existing oversight mechanisms. Given these constraints on
the potential of a safeguard policy to improve human rights accountability, I advocate for
1
Articles of Agreement of the International Bank for Reconstruction and Development, opened for
signature 27 December 1945, 2 UNTS 134 (entered into force 27 December 1945)(‘IBRD Articles’);
Articles of Agreement of the International Development Association, opened for signature 26 January 1960,
439 UNTS 249 (entered into force 24 September 1960)(‘IDA Articles’)(collectively ‘Articles of
Agreement’).
2
See, e.g., D. L. Clark, ‘The World Bank and Human Rights: The Need for Greater Accountability’, 5
Harvard Human Rights Journal 205 (2002); R. Ball, ‘“Doing It Quietly”: The World Bank’s Engagement
with Human Rights’, 34 Monash University Law Review 331 (2008).
3
For simplicity, this essay will not consider the International Finance Corporation (‘IFC’), the Multilateral
Investment Guarantee Agency (‘MIGA’), or the International Centre for the Settlement of Investment
Disputes (‘ICSID’). ‘Bank’ will be used hereafter to refer to the IDA and IBRD collectively.
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a system which incorporates human rights safeguards into evaluations of project
effectiveness, accompanied with broader reforms of Bank incentive structures. Such a
system would not only work with rather than against the Bank’s institutional limitations,
but also make the best opportunity to advance existing Bank initiatives.
2. What Would a Formal Safeguard Policy Add To Existing Bank Practice in
Relation to Human Rights?
It is perhaps an overstatement to say, as some authors do, that human rights are
‘marginal’ at the World Bank.4 At present, much of the Bank’s work engages human
rights, particularly in terms of the obligation to ‘fulfil’ human rights under the tripartite
taxonomy of obligations to ‘protect, respect, and fulfil’ human rights. As David Kinley
has noted, however, it is difficult to identify with precision what the Bank already does in
the area of human rights, because although many of its activities may have an effect on
human rights, few of them are couched explicitly in rights language. 5 The Bank’s
approach may therefore be better described as ‘doing [human rights] quietly’: 6 while it is
broadly accepting of the factual congruence between the goals of human rights and
poverty reduction, and of the guidance that principles from human rights may bring to
development projects, it stops short of incorporating human rights as legal obligations
into its work.7
A number of Bank projects engage human rights related concerns in an indirect manner.
The Bank’s official position is that its existing activities, pursued primarily for the goal of
poverty reduction, already result in greater fulfilment of human rights, particularly
economic and social rights, by providing for the basic needs of those in borrower
countries. It also runs a host of programs concerned with the policy climate in the
borrower country which can be broadly considered to promote human rights issues.
Among these are programs on governance, judicial reform, and anti-corruption; postconflict stability, gender equality, disability, and public health. By and large these
programs are expressed in terms of their economic benefit – very few explicitly use the
language of human rights, and even fewer specifically acknowledge international human
rights law norms, although there are notable exceptions such as a 2004 project to design a
human rights law curriculum at the University of Chile Law School.8
Additionally, a number of pilot and ‘learning’ projects have been set up to explore how a
more direct adoption of human rights can aid Bank activities. A special trust fund set up
in 2006 and operational since 2009 investigates the relevance of human rights to the
Bank’s work, 9 and since the early 2000s a number of workshops and official
See, e.g., G. Sarfaty, ‘Why Culture Matters in International Institutions: The Marginality of Human
Rights at the World Bank’, 103 American Journal of International Law 647, at 648 (2009).
5
D. Kinley, ‘Human Rights and the World Bank: Practice, Politics and Law’ in C. Raj Kumar and D. K.
Srivastava (eds), Human Rights and Development: Law, Policy and Governance (2006) 155, at 159.
6
See Ball, supra note 2.
7
See generally S. Mclnerney-Lankford, ‘Human Rights and Development: A Comment on Challenges and
Opportunities from a Legal Perspective’ (2009) 1 Journal of Human Rights Practice 51.
8
World Bank, ‘A Women's Human Rights Grant for Chile’ (5 April 2004)
9
World Bank, ‘The Nordic Trust Fund’ (2010) <http://go.worldbank.org/PKPTI6FU40>; Sarfaty, ‘Why
Culture Matters’, supra note 4, at 679.
4
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pronouncements have broadly supported the use of human rights concepts in the Bank’s
development projects.10 Most recently, the Nordic Trust fund has sponsored a study into
the adoption of human rights indicators in development. 11 There is therefore broad
acceptance of the role that the Bank can play in promoting the values embodied by
human rights, even if many of these are more commonly labelled ‘empowerment’, or
‘pro-poor’ polices than ‘rights’ at present.12
However, the Bank takes a more cautious approach to human rights as legal obligations.
At present, there is no systematic integration of human rights into Bank policies, despite
the increasing recognition of their relevance to the Bank’s work, and the adoption of
human rights policies by national development agencies, international development
institutions, and even certain private financial institutions.13 The closest analogues the
Bank has to a human rights policy are its social safeguard policies, adopted during the
1980s and 1990s after a series of highly criticised projects including the Sardar Sarovar
dam. 14 These policies are part of the Bank’s Operations Manual, and consist of
Operational Policies (‘OPs’), which constitute a binding set of standards on Bank staff,
Bank Procedures (‘BPs’) which provide elaboration and guidance on OPs, and nonbinding memos which provide guidance where no policies exist. 15 Existing safeguard
policies provide human rights protection in a limited set of circumstances, by requiring
consideration of the effects of Bank-funded projects on indigenous populations, gender
and involuntary resettlements, as well as a number of other environmental and social
interests.16 Staff who contravene these policies may be the subject of investigations by
the Inspection Panel. 17 While these provide valuable protection for groups most
vulnerable to adverse effects from Bank projects, particularly in large infrastructure or
extractive industries projects,18 they remain ad hoc rather than comprehensive policies,
See e.g., Symposium, ‘Human Rights and Development’ 3 Development Outreach 1 (2006). See also J.
Wolfensohn, ‘Some Reflections on Human Rights and Development’, in P. Alston and M. Robinson (eds),
Human Rights and Development: Towards Mutual Reinforcement (2005) 19.
11
S. McInerney-Lankford and H Sano, Human Rights Indicators in Development: An Introduction (World
Bank Study, 2010).
12
See, e.g., IBRD, World Development Report 2006: Equity and Development (2005).
13
See, e.g., United Nations Development Programme, ‘Human Rights in UNDP: Practice Note’ (April
2005); AusAID, ‘Human Rights and Australia’s Aid Program’ (26 August 2010)
<http://www.ausaid.gov.au/keyaid/humanrights.cfm>.
14
See B. Morse and T. R. Berger, Sardar Sarovar — Report of the Independent Review (1992).
15
See World Bank, ‘Operational Manual’ (3 September 2010) <http://go.worldbank.org/DZDZ9038D0>
16
The environmental and social safeguard policies are: OP/BP 4.00 (environmental assessment); OP/BP
4.04 (natural habitats); OP/BP 4.09 (pest management); OP/BP 4.10 (indigenous peoples); OP/BP 4.11
(physical cultural resources); OP/BP 4.12 (involuntary resettlement); OP/BP 4.36 (forests); OP/BP 4.37
(safety of dams). Additional OPs/BPs in the manual relevant to human rights include OP 4.20 (gender and
development), OP/BP 4.76 (tobacco), and OP/BP 8.00 (rapid response to crises and emergencies).
17
Resolution Establishing the Inspection Panel, IBRD Res 93-10; IDA Res 93-6, [12] (22 September 1993).
See also World Bank, Review of the Resolution Establishing the Inspection Panel: 1996 Clarification of
Certain Aspects of the Resolution (17 October 1996).
18
See, e.g., the preponderance of infrastructure and extractive industries projects in Inspection Panel,
Summary of Inspection Panel Cases (30 June 2007).
10
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and potential human rights situations not involving the particular groups named by OPs
remain outside their reach.19
The gap between recognition of human rights as values and human rights as legal
obligations has driven continuing calls for an international human rights law safeguard
policy, 20 couched in similar terms to the current policy relating to environmental
assessments, which requires consideration of both a borrowing state’s domestic
environmental legislation and its obligations under international environmental law and
states that the Bank does not fund projects that contravene such obligations.21 This would
add a number of mechanisms which would increase the level of human rights scrutiny
given to Bank projects. First, a safeguard policy would allow for the possibility of civil
society complaints through the Inspection Panel, which can only consider compliance
with operational policies, rather than being a general forum for complaints. 22 Second,
such a policy would require staff to evaluate a project’s potential impact on a borrower
state’s ability to comply with domestic and international human rights law obligations,
and to identify ways in which this impact can be mitigated. While the policies are binding
only on staff, in practice they often also form the basis for loan conditions, Country
Assistance Strategies, and Poverty Reduction Strategy Plans.23 As a borrower country is
also allowed to substitute its own equivalent system for the safeguard policy, 24 a policy
would set a minimum level of consideration that must be given to a borrower country’s
human rights obligations. Finally, advocates for safeguard policies at the Bank note that
such policies would provide clarity for staff on how to balance the potential benefits
against the potential adverse effects of a development project. 25 Thus, an effective
safeguard policy would improve both the consideration of and accountability for the
human rights impacts of the Bank’s operations.
3. Legal Considerations in the Adoption of a Safeguard Policy
A number of legal and institutional obstacles, however, constrain the ability of the Bank
to adopt comprehensive human rights safeguards. The first of these, and the one that
explains the Bank’s persistent reluctance towards human rights, is the mandate of each of
the Bank entities. Both the IBRD and the IDA are institutions with limited mandates, set
out in their respective Articles of Agreement. While historically, the mandate has been
seen to prevent consideration of human rights law, it has increasingly been seen to permit
19
For example, a 2003 study evaluating the operation of Operational Directive 4.20 (now OP 4.10) noted
that policies specific to indigenous peoples would in some contexts make unfair distinctions between
indigenous populations and other marginalised social groups, such as those subject to caste or class-based
discrimination: World Bank Operations Evaluation Department, ‘Implementation of Operational Directive
4.20 on Indigenous Peoples: An Evaluation of Results’ (10 April 2003), at 13.
20
See supra note 2.
21
OP 4.02, supra note 17, at [2]–[3].
22
Resolution Establishing the Inspection Panel, supra note 17, at [12].
23
See, e.g., BP 4.12, at [8]–[12]; I. Shihata, ‘Remedies Available to the Bank/IDA under the Loan/Credit
Agreements on the Sardar Sarovar Projects’ (16 July 1992) in I. Shihata, The World Bank Legal Papers
(2000) 619.
24
OP 4.00, ‘Country Systems Assessment’.
25
G. Sarfaty, ‘The World Bank and the Internalization of Indigenous Rights Norms’, 114 Yale Law
Journal 1791 (2005), at1803.
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a certain level of engagement with human rights by both Bank General Counsel26 and
academic commentators.27
A. Legal Framework
Three related sets of obligations govern the scope of the Bank’s mandate: the requirement
that the Bank’s activities further its purposes, the prohibition on political activities, and
the legal obligations on the Bank as a subject of international law. First, the decisions of
both institutions must be guided by the purposes in art I of each of their Articles of
Agreement. For the IBRD, this includes:
assist[ing] in the reconstruction and development of territories of members by facilitating
the investment of capital for productive purposes … promot[ing] the long-range balanced
growth of international trade and the maintenance of equilibrium in balances of payments
by encouraging international investment … thereby assisting in raising productivity, the
standard of living and conditions of labor in their territories… [and] conduc[ting] its
operations with due regard to the effect of international investment on business
conditions in the territories of members.
Similarly, the purposes of the IDA are:
to promote economic development, increase productivity and thus raise standards of
living in the less-developed areas of the world included within the Association's
membership, in particular by providing finance to meet their important developmental
requirements on terms which are more flexible and bear less heavily on the balance of
payments than those of conventional loans, thereby furthering the developmental
objectives of the [IBRD].
These establish the primary purpose of the Bank’s public sector lending agencies as that
of promoting economic development. This is now primarily framed as a focus on poverty
reduction.28
Additionally, each of the institutions is prohibited from considering the ‘political affairs’
of each member. Article IV(10) of the IBRD Articles and art V(6) of the IDA Articles
state that each institution
and its officers shall not interfere in the political affairs of any member; nor shall they be
influenced in their decisions by the political character of the member or members
concerned. Only economic considerations shall be relevant to their decisions, and these
considerations shall be weighed impartially in order to achieve the purposes stated in
[their respective Articles of Agreement].
Taken together, these provisions establish that ‘economic’ considerations may be taken
into account, but not ‘political’ ones.
See, e.g., R. Dañino, ‘Legal Opinion on Human Rights and the Work of the World Bank’ (27 January
2006); A. Palacio, ‘The Way Forward: Human Rights and the World Bank’, 3 Development Outreach 35
(2006); I. Shihata, ‘Prohibition of Political Activities in the Bank’s Work’ (11 July 1995), in The World
Bank Legal Papers, supra note 23, 219.
27
See, e.g., S. Skogly, The Human Rights Obligations of the World Bank and the International Monetary
Fund (2001); M. Darrow, Between Light and Shadow: The World Bank, The International Monetary Fund,
and International Human Rights Law (2003); B. Ghazi, The IMF, The World Bank Group, and the
Question of Human Rights (2005).
28
See, e.g., OP 1.00.
26
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B. The Bank’s Evolving Interpretation of Its Mandate
Exactly what constitutes an ‘economic’ or a ‘political’ matter has evolved considerably
since these Articles were adopted, in part because of the Bank’s evolving understanding
of development. Early interpretations took a narrow view of the Bank’s permissible
activities, with the most notorious example of this interpretation being the Bank’s
behaviour during the South African loan controversy, where the Bank refused to cease
loans to South Africa and Portugal despite recommendations by the General Assembly to
impose sanctions on both regimes for their apartheid policies.29 This interpretation did
not entirely prevent ad hoc suspension of loans based on political events, usually
construed legally as an intervening event which frustrated performance of the loan
agreement. 30 Nevertheless, the general approach was to construe the mandate as
prohibiting a broad range of activities. While these are primarily examples of
conditionality rather than safeguard policies, they do show the Bank’s then-rejection of
responsibility for human rights obligations, consistent with its understanding of its
mandate as being focused on economic growth, rather than its current wider focus on
human development.31
Evolution in the understanding of development economics, particularly in the
reconstruction of poverty as ‘capability deprivation’32 and the increasing attention paid to
the relevance of institutions and governance in economic growth 33 meant that this
mandate began to widen in the late 1980s and early 1990s. In 1990, an influential opinion
by then-General Counsel Ibrahim Shihata on governance paved the way for an expansion
of the Bank’s activities away from infrastructure projects and toward a variety of reform
projects in the borrower country. 34 Shihata argued that political activities which had
economic effects, or which constituted binding obligations under the Charter of the
United Nations (such as embargos imposed under Security Council resolutions), could be
taken into account, as long as the Bank avoided interfering in partisan politics and did not
seek to influence the borrower country’s political character.35 This allowed for a variety
of civil service and legal reforms that could improve the investment climate in the
borrower country.36 A 1998 opinion on the scope of the political prohibition went slightly
further, acknowledging that the Bank played an important role in promoting economic,
social and cultural rights, but limiting involvement in ‘political’ rights to those of
‘pervasive proportions’, or where freedoms of speech and assembly were necessary to
ensure that participation requirements in Bank environmental assessments could be met.37
While Shihata’s opinions were cautious about the Bank’s role in relation to human rights,
29
See Memorandum of the Legal Department of the IBRD, A/6825 (5 May 1967) Annex II, 9.
See, e.g., I. Shihata, ‘Effect of Security Council Decisions on Bank Operations — The Case of
Yugoslavia’ (2 June 1992).
31
See Skogly, supra note 27, at 17–19.
32
See generally A. Sen, Development as Freedom (1999).
33
See, e.g., IBRD, Sub-Saharan Africa: From Crisis to Sustainable Growth (1989).
34
I. Shihata, ‘Issues of “Governance” in Borrowing Members — The Extent of Their Relevance under the
Bank’s Articles of Agreement’ (21 December 1990) in The World Bank Legal Papers, supra note 23, 245.
35
Ibid. at 265–6, 269–71.
36
Ibid. at 274–9.
37
Shihata, ‘Political Activities’, supra note 26.
30
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they served as the legal basis for a dramatic increase in the scope of the Bank’s
functions.38
This culminated in initiatives in the late 1990s and early 2000s under Wolfensohn’s
presidency to more explicitly integrate human rights into the Bank’s work. A series of
workshops were held from 2002 to 2004 on integrating development and human rights,
and in 2006, at the request of Bank management, General Counsel Roberto Danino issued
a legal opinion on human rights that went several steps further than Shihata’s earlier
opinions, recognising human rights as ‘an intrinsic part of the Bank’s mission’. 39
Danino’s opinion removed Shihata’s previous distinction between economic and social
rights and civil and political rights, arguing that human rights considerations and
international human rights law obligations of either type could be relevant to Bank
decisions ‘provided there is economic impact or relevance’ and were done in ‘a nonpartisan, non-ideological and neutral manner, and so long as these are related to projects
the Bank aims to support’.40 Human rights could also be an acceptable consideration in
gaining an understanding of the context of a project, and if the borrower country
requested assistance in fulfilling its obligations.41 Although the status of this opinion as a
formal interpretation of the Bank’s articles is uncertain, given that it was never presented
to the Board,42 subsequent statements by Danino’s successor, Ana Palacio, have appeared
to support its approach. 43 The eventual creation of the Nordic Trust Fund and the Bank’s
general preponderance of activities in the area of gender, post-conflict, and disability
would also seem to indicate a more expansive view of the relevance of human rights to
the Bank.
This broader view of ‘economic’ and narrower view of ‘political’ would seem generally
supported by principles of interpretation. Articles 31 and 32 of the Vienna Convention on
the Law of Treaties, 44 which post-date the Articles of Agreement but are generally
accepted, including by a series of Bank General Counsels,45 to codify the customary law
applicable at the Bank’s founding, 46 allow for the plain meaning of an article to be
construed ‘in their context and in light of their object and purpose’,47 with reference to
travaux preparátoires as a ‘supplementary means of interpretation’.48 The purpose most
commonly given for the political prohibition is that of ensuring that the Bank could serve
a wide variety of member states with differing ideologies, as well as for ensuring that the
Bank would remain an efficient financial institution and not an instrument for the
Sarfaty, ‘Why Culture Matters’, supra note 4, at 660.
Dañino, supra note 26, at [25]
40
Ibid. at [13]–[14].
41
Ibid. at [12], [19]–[20].
42
Sarfaty, ‘Why Culture Matters’, supra note 4, at 665.
43
Palacio, supra note 26. But see ibid. at 665–7, who argues that Danino’s opinion had little influence over
attitudes towards human rights at the bank.
44
Opened for signature 23 May 1969, 1155 UNTS 331 (entered into force 27 January 1980) (‘VCLT’).
45
See Shihata, ‘Governance’, supra note 34, 259–60.
46
Note that the reference for the initial project in 1949 was to codify lex lata: ‘Report by J L Brierly,
Special Rapporteur’ [1950](II) Yearbook of the International Law Commission 222, at 225.
47
VCLT art 31(1).
48
VCLT art 32.
38
39
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political agendas of its members.49 A safeguard policy focusing on existing obligations
assumed by the borrower state under international law, with the state’s theoretical
consent, remains consistent with this purpose, especially as safeguards bind only Bank
staff and mostly affect the design of projects, which are minimally intrusive to broader
questions of state sovereignty.
This is especially so given that the approaches to interpreting treaties which form the
constitutive instrument of international organisations tend to both favour the functionality
of the organisation and to take into account the practice of the organisation itself.50 The
continuing legal debates over the scope of the Bank’s mandate exemplify the difficulty of
adapting its limited constitutive instruments to changing world circumstances and
evolving understandings of development effectiveness. The Bank’s mission has evolved
over its 60 years of existence from a narrowly defined mission of post-war reconstruction
to a broadly defined concept of poverty reduction that includes both material poverty and
the broader idea of ‘capabilities’. 51 There is additionally now a significant body of
research showing the importance of a number of rights to economic growth and poverty
reduction, issues that could not have been on the agenda at the original Bretton Woods
conference, 52 while understandings of state sovereignty and the scope of acceptable
‘political interference’ have significantly narrowed since the Bank’s mandate was
adopted.53 In light of these changing circumstances, there is at least some argument for
allowing consideration of human rights concerns in a non-partisan manner, where they
can be shown to be necessary for the effectiveness of the project in promoting poverty
reduction.54
Nevertheless, it is still unclear to what extent human rights as freestanding concerns
rather than ‘good business decisions’ are permissible considerations. Given that the entire
purpose of a safeguard policy is to place constraints on development where it poses risks
to given non-economic concerns, and given that the link between observance of rights
and economic growth is not always easily ascertained,55 it is necessary to determine the
extent to which there are legal bases for a human rights safeguard policy which do not
rely on economic impact.
Shihata, ‘Political Activities’, supra note 37, at 226–7.
See, e.g., Reparation for Injuries Suffered in the Service of the United Nations (Advisory Opinion) ICJ
Reports (1949) 174, at 179–84; T. Sato, Evolving Constitutions of International Organizations (1996) at
260, 267–8. See especially the concept of ‘implied powers’: J. Klabbers, An Introduction to International
Institutional Law (2002) at 60–81; Darrow, supra note 27.
51
See OP 1.00, supra note 28.
52
See, e.g., D. Kaufmann, ‘Human Rights and Governance: The Empirical Challenge’ in Alston and
Robinson, supra note 10, 352.
53
See Dañino, supra note 26, at [17]; Skogly, supra note 27, at 94–9.
54
The Bank’s practice in areas such as post-conflict governance and gender suggests an increasing level of
support for such an interpretation, although at present the fact that the ban on political activities is
interpreted inconsistently across the Bank lessens the extent to which such practice can be said to have
legal effect. For a comprehensive examination of Bank practice, see Skogly, supra note 24; Darrow, supra
note 24.
55
Kaufmann, supra note 52, at 352 (commenting on the paucity of existing measurement).
49
50
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C. Obligations Incumbent upon the Bank
Arguably, such a basis can be found in the Bank’s own obligations as a subject of
international law, and in that of its member states. Each Bank arm has legal personality,
given their extensive treaty making activities with its borrower states, as well as its
relative independence from members, and their grants of jurisdictional immunities by
host states.56 While they are not bound by human rights treaties, given that these only
have state parties, the Bank is bound by rules of customary international law.57 Where
these rules are peremptory norms, these will override the political prohibition in the
Articles of Agreement.58 The Bank therefore is bound by at least the very small number of
human rights norms which constitute jus cogens, including customary prohibitions on
torture, genocide, and racial discrimination,59 regardless of what its Articles of Agreement
say, and is obligated at the level of having to ‘respect’ these rules, and possibly to
‘protect’ them where a borrower state may violate them in the context of a Bank
project.60 The relative unlikelihood of Bank projects causing breaches of human rights on
the scale of such abuses as genocide aside, these may provide a legal basis for safeguard
policies protecting jus cogens rights.
Certain provisions in the Bank’s relationship agreement with the United Nations may also
provide a legal basis for provisions that could be included in a safeguard policy. While
this relationship agreement grants the Bank a great degree of independence,61 it has been
interpreted to require the Bank to obey Security Council resolutions under arts 41 and 42
of the UN Charter (generally to prevent the Bank from asking states to breach their
obligations under the Charter, which prevail over other agreements, rather than as the
Bank’s own obligation), 62 as well as, more controversially, those made under General
Assembly resolutions under the ‘Uniting for Peace’ resolution.63 It should be noted that
this does not extend to General Assembly resolutions generally: indeed, this was the
precise justification for the Bank’s actions in regards to the Portugal/South Africa loans
controversies.64
56
As per the requirements and salient facts outlined in the Reparations Case, supra note 50, at 178–80.
See, e.g., C. F. Amerasinghe, Principles of the Institutional Law of International Organizations
(Cambridge University Press, 1996) 240.
58
VCLT art 53.
59
Listed as among the most frequently cited jus cogens norms in International Law Commission,
Fragmentation of International Law: Difficulties Arising from the Diversification and Expansion of
International Law, A/CN.4/L.702 (13 April 2006) at [33].
60
Skogly, supra note 27, at 151; Ball, supra note 2, at 352. Note that customary obligations which are not
jus cogens also bind the Bank unless treaty obligations override them, which would also allow for any
customary obligations consistent with the political prohibition to form the legal basis of human rights
obligations. This is likely to be substantially the same as the scope of ‘economic’ activities permitted under
the mandate, discussed above Pt III(B), although it is worth noting that customary human rights norms are
obligations on and not merely permissions allowed the Bank.
61
Agreement between the United Nations and the International Bank for Reconstruction and Development,
16 UNTS 346 (signed and entered into force 15 November 1947) art IV(3); Agreement between the United
Nations and the International Development Association, 394 UNTS 222 (signed and entered into force 27
March 1961) art I.
62
See ibid. art VI, Shihata ‘Political Activities’, supra note 26, at 235.
63
See Shihata, ‘Governance’, supra note 34, at 266.
64
Ibid. at 266–7.
57
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Finally, the obligations of borrower countries are also relevant. The Bank has recognised
that it can perform a facilitative role in aiding states obligations under human rights
treaties, if member states so request.65 An argument can also be made that the Bank can
be held responsible for complicity in breaches of international law by borrower states,
although this is limited to international law that the Bank itself is bound by, and is
therefore of limited applicability to breaches of obligations under human rights treaties.66
The framework surrounding the Bank’s engagement with human rights can therefore be
summarised as a requirement under general international law obligations to ‘respect’
human rights under custom and Security Council resolutions, while the Bank’s Articles of
Agreement allow for, but do not require, consideration of borrower state obligations at all
three levels of respecting, protecting, and fulfilling, if such activities can be characterised
as ‘economic’ rather than ‘political’. This framework would appear to support a
safeguard policy, provided that such a policy focused on facilitating the treaty obligations
of the borrower states; meeting obligations under a limited number of customary norms
that are either characterisable as ‘economic’ or could be considered jus cogens; or on
following binding declarations made by the Security Council or ‘Uniting for Peace’
resolutions by the General Assembly.
4. Institutional Considerations in the Adoption of a Safeguard Policy
A. Appropriateness of Using a Safeguard Policy to Enforce Human Rights
In addition to legal limits, certain institutional limits must be considered in designing a
safeguard policy. These include concerns about the desirability of having the Bank
interpret human rights norms. The Bank has a voting structure that favours its wealthier
members, with votes being tied to financial contributions,67 and its President, by custom,
always being nominated by the United States. Additionally, it exercises great economic
power through control of access to loans over its poorer member states, who are often
unable to access other capital markets due to their poor credit ratings.68 There has been
longstanding controversy over the Bank’s imposition of policy conditionality in its loans,
particularly in light of structural adjustment programs during the 1980s,69 and given that a
human rights safeguard policy would likely be incorporated into loan agreements, it may
possibly form the basis for inappropriate control over a borrower state’s policy
autonomy. 70 There are also concerns that the Bank’s interpretation of its safeguard
policies is likely to result in the normative ‘capture’ of human rights standards,
particularly given that the Bank’s economic power means that it has greater power to
65
Dañino, supra note 26, [19].
See ‘Draft Articles on the Responsibility of International Organizations’, arts 13, 16, in ‘Report of the
International Law Commission on the Work of Its 61 st Session’ [2009] II(2) Yearbook of the International
Law Commission 13, at 85, 88.
67
IBRD Articles art V(3)(a), IDA Articles art VI (3)(a).
68
Hence art I of the IDA Articles.
69
See Darrow, supra note 27, at 68–71, 209–10; Skogly, supra note 27, at 16.
70
See M. Thomas, ‘Can the World Bank Enforce Its Own Conditions?: The World Bank and the
Enforcement Critique of Conditionality’ (2004) 35 Development and Change 485, at 486.
66
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enforce its own standards than the human rights related specialised agencies have to
enforce theirs.71
Finally, safeguard policies could increase the cost of lending at the Bank, potentially
deterring lending that could benefit populations.72 This has been a longstanding concern
of the Bank, given the availability of bilateral lending sources that may contain even
fewer safeguards than those of the Bank.73 These concerns about costs are partially offset
by potential savings from streamlining the Bank’s existing safeguard policies, as well as
by the gains in the overall impacts of the loan — ultimately, it is counterproductive to
lend in situations if it may be detrimental to the welfare of communities in borrower
countries.74 It is also important to note that many high risk projects are not particularly
attractive lending prospects, particularly in IDA countries, due to the low
creditworthiness of the borrower countries, reducing concerns about the substitutability
of less stringently conditioned loans. Given, however, that increases in the cost of lending
due to safeguard policies may involve trading off the overall benefits of a project against
the interests protected by the safeguard, and that increases in the cost of lending result in
increases in the overall indebtedness of borrower countries, cost concerns nonetheless
affect the viability of a safeguard policy.
B. Effectiveness of a Potential Safeguard Policy at Ensuring Protection of Human
Rights in Practice
These concerns act in combination with what has been called a ‘culture of approval’ at
the Bank.75 The frequent use of lending targets, and the tendency of staff incentives to be
structured around the amount lent regardless of the success of the lending project has
meant that Bank staff often see safeguards as an obstacle or a box to be checked, and
accept partial compliance with safeguards as ‘good enough’.76 In particular, the safeguard
policy on indigenous peoples has frequently been violated, especially where the political
attitudes in the borrower country towards the identification of who is indigenous conflicts
with that of the Bank.77 The pressure to lend also results in perverse incentives to avoid
projects which may aid indigenous peoples or the environment, to avoid the requirement
to follow safeguard policies.78 Similar problems plague the Bank’s civil society
participation initiatives, which are also frequently ignored or only superficially complied
with due to perceptions that they obstruct the efficiency of projects.79 The short length of
project cycles contributes to this problem: with insufficient time to comprehensively
71
Ball, supra note 2, at 366; Darrow, supra note 27, at 195.
See, e.g., World Bank, ‘Enhancing World Bank Support to Middle-Income Countries: Management
Action Plan’ (20 April 2004), Ball, supra note 2, at364–5.
73
See Clark, supra note 2.
74
Ball, supra note 2.
75
See,e.g., W. Wapenhans, ‘Effective Implementation: Key to Development Impact’ (1992).
76
Ibid. See also A. Ebrahim and S. Herz, ‘Accountability in Complex Organisations: World Bank
Responses to Civil Society’ (2007), at 6–7. Cf Thomas, supra note 70.
77
See World Bank Operations Evaluation Department, ‘Implementation of Operational Directive 4.20 on
Indigenous Peoples: An Evaluation of Results’ (10 April 2003) 11, at 41. This review found that only 62%
of projects affecting indigenous people applied OD 4.20, the precursor to OP 4.10. See also Sarfaty,
‘Internalization of Indigenous Rights Norms’, supra note 25, at 1805.
78
Sarfaty, ‘Internalization of Indigenous Rights Norms’, supra note 25, at 1814.
79
Ebrahim and Herz, supra note 76, at 5–7.
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evaluate projects or ensure participation, success or failure is often judged by lending
quantities and project completion rates.80 The tendency to avoid safeguards also reflects a
wider conflict of values between the overall economic benefit of a project and social and
environmental concerns, with the latter usually taking precedence due to the Bank’s
generally economist-dominated institutional culture and the insufficient training given to
Bank staff on how to balance such tradeoffs.81
These concerns are compounded by the relative difficulty of enforcing safeguard policies.
While the Inspection Panel represents an important opening for review of safeguard
policies, and has taken steps to safeguard its independence, it has no powers of
supervision, and relatively limited powers of investigation.82 Particularly where projects
are underway, findings of violations may not result in tangible changes. For example, a
pipeline project between Chad and Cameroon was continued by Bank management
despite clear findings of violations of multiple safeguard policies, although the project
was eventually discontinued for loan agreement breaches.83 The heavy reliance on Bank
management for many aspects of the Inspection Panel’s fact-finding also leaves it
vulnerable to attempts by to obstruct Panel investigations, as happened, for example, in
the review of the Albania Integrated Coastal Zone Management Project.84
Further, there have been concerns that the increase in use of Country System
Assessments in place of formal safeguard policies will lead to the impairment of
Inspection Panel review due to the less precise standards likely to be in use, and therefore
the lower likelihood that a breach of policy will be found.85 For example, the Center for
International Environmental Law commented in 2005, when the Country Systems
approach was first implemented, that the use of ‘equivalent’ borrower systems would
compromise Inspection Panel review legally, as the subjective standards in use would be
difficult to assess; politically, as the review of a country system would raise questions of
‘inappropriately judging the quality of a country’s legal system’, and institutionally, due
to the greater resources required and the lack of additional funding provided to the
Inspection Panel.86 These concerns are likely to be magnified if a comprehensive human
80
Ibid. at 6.
Sarfaty, ‘Why Culture Matters’, supra note 4, at 669–70, 674.
82
Resolution Establishing the Inspection Panel [23]; Inspection Panel, Chad: Petroleum Development and
Pipeline Project (17 July 2002) at 60–3, where the panel commented on governance and human rights
implications of the project despite such issues being outside its explicit mandate. See also Clark, supra note
2, at 217–18; L. Polgreen, ‘World Bank Ends Effort to Help Chad Ease Poverty’, New York Times, 10
September 2008.
83
Inspection Panel, Chad: Petroleum Development and Pipeline Project, supra note 82, at 45–64;
Inspection Panel, Management Report and Recommendation in Response to the Inspection Panel
Investigation Report (21 August 2002) at 17. See also Clark, supra note 2, at 219; A. Clapham, The Human
Rights Obligations of Non-State Actors (2006) at 153–5.
84
Inspection Panel, Albania: Integrated Coastal Zone Management and Clean-Up Project (24 November
2008) at 68.
85
See Centre for International Environmental Law, ‘The Use of Country Systems in World Bank Lending:
A Summary of the Lessons from the Pilot Projects and Recommendations for a Better Approach’ (2 April
2008).
86
Center for International Environmental Law, ‘Comments on World Bank’s Proposed Country Systems
Approach’ (January 2005) at 5.
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rights safeguard policy is introduced: to judge the equivalence of a borrower country’s
human rights system to that of a safeguard policy would be especially politically difficult,
and the alternative of excluding the possibility of country systems from a human rights
policy would not be any easier. Additionally, given the scope and variety of domestic and
international human rights obligations, the required resources to effectively enforce a
safeguard policy relating to human rights could potentially be enormous, and the Panel’s
ability to make evaluations and interpretations of ‘equivalence’ may not be entirely
satisfactory without them. Reconciling a comprehensive human rights safeguard policy
with the flexibility to use a borrower systems approach would lead to many difficulties
unless there were very clear expectations set by the Bank on the type of country system it
would consider equivalent.
These problems are of particular importance given that outside of the Inspection Panel,
opportunities to enforce a human rights policy of any kind are limited. While various
other monitoring and evaluation mechanisms exist, such as the Independent Evaluation
Group and the Quality Assurance Group, these largely review the overall operations of
the Bank rather than particular complaints and, as for the Inspection Panel, responsibility
for monitoring further compliance remains with the Bank’s internal processes.87 External
dispute mechanisms are difficult to access due to the Bank’s immunities under domestic
law and the impracticability of using international dispute settlement mechanisms:
affected populations often do not have standing, while states rarely have strong enough, if
any, interests in enforcing safeguard policies to justify international litigation.88
5. Safeguard Policy Design
While these critiques are persuasive, they indicate the need for careful design of a human
rights policy, rather than an indication that one should not be adopted. Many of these
critiques are based on the assumption that human rights safeguards would mostly consist
of imposed negative proscriptions written by the Bank. An alternative approach to
creating a safeguard policy, given the constraints of the Bank, is in fact to incorporate
human rights concerns into the goals and benchmarks for evaluating the development
success of a project.
Broadly speaking, this can be described as a ‘dialogue’ approach to human rights.89 It
would consist of a requirement on staff to assess, with broad consultation with both the
state and civil society, the legal obligations of the borrower state under both domestic and
international law, and to incorporate such obligations during the design stage as
objectives for the project such obligations. The success of a project could be measured by
regular monitoring and evaluation against these objectives, perhaps through the use of
special indicators, with an emphasis on using data which is disaggregated to take into
account the most vulnerable groups and to ensure that the least-well off rather than the
World Bank, ‘The Independent Evaluation Group (Bank): Terms of Reference’ (2003), available from
<http://go.worldbank.org/GU2KYF31B0>. See also Ebrahim and Herz, supra note 76, 9.
88
See, e.g., Statute of the International Court of Justice art 34; Skogly, supra note 27, 186; E. Suzuki and S.
Nanwani, ‘Responsibility of International Organizations: The Accountability Mechanisms of Multilateral
Development Banks’, 27 Michigan Journal of International Law 177, at 182–4 (2005).
89
J. Agusti-Panareda, ‘Transforming Weakness into Virtue: A Dialogue and Context Based Approach to
Human Rights at the World Bank’, 2 Human Rights and Globalization Law Review 23 (2008).
87
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aggregate are taken as benchmarks. Thus, the success of a particular project would be
measured not only in terms of its outputs, but also whether it achieves those outputs
without detrimental effects on local populations — in effect, the safeguard policy is used
to ensure a more holistic measure of the overall project outcome. To keep the possibility
of Inspection Panel review, the OP could explicitly provide for minimum levels of
compliance with the goals set between the Bank and the borrower state. More traditional
proscriptive obligations could also be included for a limited number of customary norms
that constitute the Bank’s own obligations. However, the safeguard would act mostly as a
carrot rather than a stick — it would set incentives to respect, protect, and fulfil human
rights. Given the weak supervisory powers of the Inspection Panel, a realignment of aims
is likely to be more effective than any threat of review in ensuring greater consideration
of human rights.
The advantage of such an approach is that it builds on the institutional strengths of the
Bank, which is still, after all, a lending institution, and not a human rights body. It would
fit into the Bank’s current concern with development effectiveness, as well as its current
broadly defined conception of poverty. 90 By reorienting the goals of development to
include human rights concerns, the Bank builds on an approach that already takes place
in certain Bank programs such as the gender program and the Nordic Trust Fund. By
integrating with these pre-existing approaches, it also allows the Bank to simultaneously
review and improve on its existing initiatives which relate to human rights. While this
‘negotiated benchmark conditionality’ approach can be criticised for reducing the
potential of human rights as a tool for transformative change, it has the advantage of
being clearly within the Bank’s mandate, and of its ability to build a broad base of
support within the Bank which could serve as a springboard for stronger programs.91
Additionally, stricter forms of conditionality for those norms which can be considered jus
cogens provide a non-negotiable layer of protection.
A vast body of resources exists for the Bank to draw on in the implementation of this
model. The Bank could draw on its partnership with the OHCHR, which has developed a
number of guiding standards on integrating human rights and development, as well as
with development agencies and other multilateral banks (bearing in mind, of course, that
many of these bodies have explicit human rights mandates and that their standards may
require adaption to be permissible under the Bank’s Articles). 92 The Bank’s key
advantage is the breadth and depth of its technical expertise, and is well placed to work
with the OHCHR on technical capacity-building in states which are amenable to human
rights activities. 93 The Bank could also draw on the work of the Nordic Trust in
developing human rights benchmark indicators,94 and the work currently being done on
integrating human rights into poverty reduction strategies.95 A human rights policy of the
90
See, e.g., OP 1.00.
Sarfaty, ‘Why Culture Matters’, supra note 4, 682–3; Agusti-Panareda, supra note 89, 34.
92
See, e.g., OHCHR, ‘Principles and Guidelines for a Human Rights Approach to Poverty Reduction
Strategies’ (2006); OHCHR, ‘Human Rights and Poverty Reduction: A Conceptual Framework’ (2003).
93
Agusti-Panareda, supra note 89, 35–8.
94
McInerney-Lankford and Sano, supra note 7.
95
See, e.g., F. Stewart and M. Wang, ‘Poverty Reduction Strategy Papers within the Human Rights
Perspective’ in Alston and Robinson, supra note 10.
91
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type suggested above could also form part of the Bank’s response to recent suggestions
by the Independent Evaluation Group that the Bank should consolidate its social
safeguards into one integrated policy.96
Such a model would, however, have to take place in context of broader reforms. It is not
the place of this article to attempt to suggest reforms for the entire World Bank. Some of
the obstacles outlined in Part IV, such as that of the Bank’s voting structure, are also
likely to be intractable. However, a number of smaller, staff level changes could be
possible. These include increasing the length of project cycles and readjusting staff
incentives along lines of impact rather than lending targets, which tie into existing
reviews undertaken to improve compliance with safeguard policies.97 The Bank could
also provide greater training and dialogue on how to monitor safeguard compliance and
balance the competing concerns of Bank projects. 98 In combination with a safeguard
policy, these changes could potentially greatly improve the human rights accountability
of the World Bank to those vulnerable to the effects of its projects.
6. Conclusion
In light of the recent renewed focus on human rights at the World Bank, it may be an
opportune time to attempt to reintroduce a comprehensive human rights safeguard policy.
I have attempted to show in this essay that many of the traditional obstacles to an
effective safeguard policy can be overcome by a combination of careful design, and by
accompanying reforms to the broader evaluation of Bank projects.
One obstacle which I have not dealt with is that of political will. It remains to be seen
whether a human rights policy would be able to be adopted by the Board, which has
historically been deeply divided over the question of human rights.99 It also remains to be
seen whether the adoption of a human rights safeguard policy applicable to staff would
translate to a greater willingness by member states to engage with even this limited form
of human rights conditionality. Nevertheless, critically evaluating the legal and policy
justifications for excluding a comprehensive safeguard policy incorporating international
human rights law norms is a small but necessary step to building the political will toward
its adoption.
96
World Bank Independent Evaluation Group, Safeguards and Sustainability Policies in a Changing World
(23 September 2010), at 104.
97
See, e.g., ibid. at 104–5.
98
Sarfarty, ‘Internalization of Indigenous Rights Norms’, supra note 25, at 1803, Safeguards and
Sustainability Policies in a Changing World, supra note 96, 31.
99
Sarfarty, ‘Why Culture Matters’ supra note 4, at 665.
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