Performance Standard 6 Biodiversity Conservation & Sustainable Natural Resource Management Stakeholder Feedback Frequently Asked Questions IFC Response Why does the definition of modified habitats not include wetlands? This has been corrected in the current draft of PS6. The last sentence in paragraph 11 now reads “Modified habitats may include areas managed for agriculture, forest plantations, reclaimed coastal zones, and reclaimed wetlands”. Why is IFC not using a more traditional definition of ‘habitats’? Why is the ‘ecosystem’ terminology not used instead of habitat? And, why is IFC not using an HCV (High Conservation Value) approach? These questions are presented under one heading as their answers are related. PS 6 purposely provides a broad definition of habitats as ‘land areas’ (or ‘geographical units). Modified, natural and critical habitat refers to the biodiversity value of the land area as determined by species, ecosystems and ecological processes. We understand that this is quite a departure from a technical ecological definition of habitat (i.e., the place or type of site where an organism or population naturally occurs). The reason for this is because projects are discussed in the vernacular as being ‘in’ or ‘out’ of modified, natural or critical ‘habitat’, which must account for other ecological aspects in addition to species. Some argue then to discard the habitats language in favor of ecosystems; however, project areas may span more than one ‘ecosystem’, and the scale of an ecosystem itself is also not easily definable. Although defining the project site in terms of ecosystems is a valid approach as part of the biodiversity assessment, this language also does not lend itself well to communicating with the client’s non-ecologists (e.g., project operators). Other stakeholders then opt for the High Conservation Value (HCV) terminology and approach. The problem with this approach is that HCVs are usually defined in managed agricultural and forestry landscapes, and the concept does not always lend itself to other types of areas or project types (e.g., in protected areas, linear infrastructure). Many industries with whom IFC works are also not familiar with this terminology. Lastly, HCV areas would not be a direct substitute for natural or critical habitat as a number of HCV types are focused on ecosystem services. The requirements for HCV Types 1 – 6 span across those currently found in natural habitat, critical habitat and ecosystem services. Moreover, client requirements for ecosystem services are cross-cutting through Performance Standards 4, 5, 6, 7 and 8, which are more appropriate places to cover some of the HCV types. In sum, we decided to remain with the habitats terminology for this revision of the Performance Standards. IFC is trying to navigate within a very wide range of clients, sectors, governments, etc. The Performance Standards have been operational for only four years, and the users of PS 6 have familiarized themselves with this term. We will however explain in GN 6 how HCV types overlap with PS 6 requirements. What is the difference between set-asides and biodiversity offsets? Set-asides and biodiversity offsets are related, but different concepts. Set-asides are land areas, usually within the project site or in other adjacent areas over which the client has management control, that are “…excluded from development and… targeted for the implementation of conservation enhancement measures”. Biodiversity offsets are usually more robust than set-asides as they should be designed to compensate for significant residual impacts only, and must demonstrate no net loss, and preferably net positive gains of biodiversity. Set-asides are the equivalent to “avoidance measures” along the mitigation hierarchy and are sometimes prescribed by the government to be a certain percentage (e.g., 20 percent) of the land area to be converted. In order to design a biodiversity offset however, practitioners would need to carry out an assessment to determine that the loss of biodiversity on-site is compensated for with the gains in biodiversity at the offset site. Biodiversity offsets must be designed to conserve the same biodiversity values that are being impacted by the project (an ‘in-kind’ or ‘like-for-like’ offset). Set-asides are a common form of mitigation in the industries of agribusiness and forestry. The terminology is less familiar to mining and oil & gas operators. Set-asides may also be areas of HCV, a mitigation approach referenced in many of the international voluntary international standards, such as Forest Stewardship Council (FSC). We have incorporated the setaside terminology in PS 6 to be more consistent with some forms of governmental legislation and with mature and evolving international standards. Although mining and oil & gas operators do not typically subscribe the ‘set-aside’ terminology, the practice is essentially the same. In areas of natural habitat, certain areas of higher biodiversity value are avoided and ‘set aside.’ The last bullet in the original paragraph 10 (under natural habitat) has been eliminated – “compensation to direct users of biodiversity.” Is this covered elsewhere? This was eliminated from PS 6 for several reasons: (a) requirements for ecosystem services have been separated from those for biodiversity/habitat. “Users of biodiversity” are essentially “beneficiaries of provisioning and cultural ecosystem services”, which is addressed elsewhere in PS 6; (b) the topic of compensation (for biodiversity, natural resources or for any other asset) is not well understood by the primary practitioners of PS 6). Compensation is a topic that is covered in depth under PS 5 and by social specialists. In the upcoming revision of the Performance Standards, we will be drawing stronger links between PS 5 and PS 6 to make this more evident. What is the meaning and purpose of the original footnote 16? Footnote 16 was meant to indicate that not all legally protected areas and designated areas were by default critical habitat. Only those areas whose “primary management objectives…are comparable with the management objectives as described for IUCN Management Categories Ia, Ib and Category II” (footnote 16) were, by default, critical habitat. However, we re-evaluated this during the second stakeholder consultation, and this footnote will be removed. There will be no pre-assigned determination of which legally protected and designated areas will or will not be critical. An assessment will take place in all areas to determine if they are critical habitat per IFC’s definition. The bullet points in paragraph 17 will apply to all legally protected and designated areas. Why are the words ‘over time’ added to the end of the second bullet of paragraph 15 in the critical habitat requirements? Those words were added to make it clear that some loss of species may occur in the short-term at the project site, but the mitigation measures should be defined to ensure that there will be no net loss at the global/regional/national populations, where applicable, in the long-term. Many stakeholders who commented on this section stated that the “over time” wording was redundant of “net”. When is a Biodiversity Action Plan (BAP) or a biodiversity assessment required? A BAP will be required for all projects in critical habitats. A BAP will be required on an as-need basis in natural habitats and this will be explained in GN 6. Regarding biodiversity assessments, this should be integrated into the initial ESIA per PS 1. If it is not, or if this assessment is inadequate depending on the nature and scale of the project, we will request a supplemental biodiversity assessment. In the Management of Renewable Natural Resources section, why is IFC not requiring just ISEAL compliance, which would remove questions on whether other standards were credible or independent? The use of private voluntary standards is increasingly important to IFC and its clients, particularly in the conservation of biodiversity and stewardship of ecosystem services. IFC has and will continue to support the development and application of internationally-recognized and independentlyverified standards for living natural resources. Both ISEAL's Code of Good Practice and ISO Guide 65 are included in the PS as normative references. There are many standards however, that are in development or in use that have proven effective in managing PS 6 risks which are not "ISEAL compliant" or even members of the ISEAL Alliance. IFC will continue to carefully review international, regional and national standards for conservation and strongly encourage clients to verify their conformity with acceptable standards to manage E&S risks. Comments IFC needs to integrate the concept of ecosystem services throughout the other Performance Standards. References are made to PS 5 and PS 8 in PS 6 that have no follow-up requirements in either of these two Performance Standards. We agree, and have incorporated this cross-cutting topic throughout the Performance Standards. In the other Performance Standards, we will be using language that makes sense to the practitioners of those particular standards. The modification of the critical habitat definition appears to be ‘watered down’, especially with respect to the elimination of ‘biodiversity of significant social, economic, and cultural importance to local communities’. There are currently no requirements in the other Performance Standards on this topic that equal the level of protection it once was afforded in PS 6. This topic should be re-inserted into the definition of critical habitat. ‘Biodiversity of significant social, economic, and cultural importance to local communities’ is a subset of ecosystem services. The previous placement of this topic was in critical habitat, which is implemented almost exclusively by biodiversity specialists who are usually not familiar with the means to identify or assess natural resource-based assets in terms of their value to local communities. Other social scientists and cultural anthropologists however do this routinely. We believe that this topic is better served if it were mainstreamed throughout the Performance Standards. IFC should significantly strengthen their requirements for biodiversity offsets, and provide better explanation for when offsets should be considered. IFC should adopt Offset Principles as established by the Business and Biodiversity Offset Program (BBOP) and integrate them into PS 6 requirements. We partially agree. To clarify, biodiversity offsets are not by default a requirement in all projects in critical habitat. Biodiversity offsets are however a valid option to mitigate significant residual impacts if a suitable offset could be designed and implemented in a manner that meets the other critical habitat requirements defined in paragraph 15. The definition of an offset is provided in footnote 6, which makes it clear that offsets are to be used to mitigate significant adverse impacts “…after appropriate avoidance, minimization, and restoration measures have been taken”. We will not singularly adopt BBOP’s principles and methods in determining the suitability of proposed offsets. BBOP’s acquired experience over the last several years is extremely valuable, and we make reference to their guidance materials in the revised GN 6. These references will remain as guidance and we will utilize other norms and practices as they develop. The risks and identification process should include ‘cumulative’ impacts in addition to direct and indirect impacts. We partially agree, but cannot fully accommodate this recommendation. The topic of cumulative impacts is covered under client requirements in a project’s ‘area of influence’ as defined in PS 1. The assessment of cumulative impacts will not be included as a specific requirement of PS 6. Clients should be required to manage and monitor impacts through a system of adaptive management. This should be a client requirement for projects in critical habitats. We agree, but we feel that this concept is already integrated into PS 1 as part of the client’s ‘Social & Environmental Management System’. We understand that the terminology ‘adaptive management’ is well-accepted among managers of natural resources and biodiversity, but it is less familiar to other users of the Performance Standards. We see the value however in stressing the adaptive management concept in particular for this Performance Standard. The application of the Management of Renewable Natural Resources section is not clear, and some of the terminology used in this section, such as ‘plantations’, is confusing. The section should be revised. We appreciate the desire for clarity, and have sought to address this in Version 2 of PS6. Note: IFC’s responses to questions and comments are based on the current draft (Version 2) of IFC’s Sustainability Framework. They are subject to change as the Framework is further revised. No text in the Framework or in these interim comments and responses is final until approved by IFC’s Management and Board.