Development Finance Institutes play a critical role in promoting sustainable economic growth as they fund large scale infrastructure development and projects. However DFIs do not consistently adhere to or apply ESG criteria, and can fund controversial projects such as coal fired power plants to the detriment of communities and the environment.
The Fair Finance Guide Methodology assesses Financial Institutions' approach to sustainability across 23 influential themes, including corruption, human rights, and climate change. The report shows that whilst a couple of Development Finance Institutes score moderately well for certain policies, several scored zero on critical policies such as those for health, human rights and nature. (A zero score can mean that policies are non-existent or that they are not publicly available.) This is extremely concerning given the scope and scale of the development programs these Development Finance Institutes invest in.