UKEF's implementation of the Equator Principles (1st November 2016 - 31st October 2017)
Published 10 January 2018
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This publication is available at https://www.gov.uk/government/publications/ukefs-implementation-of-the-equator-principles-1st-november-2016-31st-october-2017/ukefs-implementation-of-the-equator-principles-1st-november-2016-31st-october-2017
1. Background: Equator Principles
UK Export Finance (UKEF) adopted the Equator Principles (EPs) on 31 March 2016, joining over 90 other international financial institutions in applying this global guidance for environmental, social and human rights (ESHR) risk management when financing projects.
UKEF continues to follow the OECD Recommendation on Common Approaches for Officially Supported Export Credits and Environmental and Social Due Diligence (OECD Common Approaches), currently dated 07 April 2016, which it applies in tandem with the EPs as outlined in its Policy and practice on Environmental, Social and Human Rights due diligence and monitoring (ESHR policy). This reporting of our progress between 1st November 2016 and 31st October 2017 forms part of UKEF’s obligations under Equator Principle 10 (Reporting and Transparency) and as articulated in Annex B of the EPs.
2. Projects supported within the scope of the Equator Principles
Between 1st November 2016 and 31st October 2017, UKEF has reached financial close on 3 transactions that fell within the scope of the Equator Principles, and for which it received an exporter application form following UKEF’s adoption of the EPs. These are reported in Table 1 (Project-related corporate loans) and Table 2 (Project finance).
2.1 Project-related corporate loans
| Category | Sector | Region | EP country designation | Has an independent review taken place? |
|---|---|---|---|---|
| B | Infrastructure | Middle East | Non-designated (UAE) | No |
| B | Infrastructure | Middle East | Non-designated (UAE) | No |
2.2 Project finance
| Category | Sector | Region | EP country designation | Has an independent review taken place? |
|---|---|---|---|---|
| C | Transport | Americas | Non-designated (Mexico) | No |
See details for the above project finance case.
UKEF has not carried out any project finance advisory services or bridge loans during the reporting period.
3. Implementation of the Equator Principles
UKEF’s ESHR policy sets out how UKEF implements the Equator Principles in tandem with the OECD Common Approaches during pre-issue stages (scoping, screening, due diligence review), which satisfies Equator Principles 1-8, and for post-issue monitoring, to satisfy Equator Principle 9. UKEF published a Note of Human Rights and Social Risks and Impacts in support of its ESHR policy in March 2017. Further information can also be found in UKEF’s Annual Report and Accounts 2016/17.
UKEF’s Environmental and Social Risk Management Team (E&S Team), formerly known as the Environmental Advisory Unit, is responsible for carrying out the implementation of UKEF’s ESHR policy.
The E&S Team’s staff are professionally qualified and directly undertake and/or manage the necessary ESHR due diligence and liaise with project sponsors and/or exporters and UKEF decision-makers. The E&S Team has 6 full time staff and reports directly to the Head of Business Group and the Chief Executive. The E&S Team continues to provide internal training to UKEF’s Business Group (including underwriters), and wider staff, to raise awareness of the requirements of the OECD Common Approaches, the EPs, and general ESHR risk management.