We have a number of processes for embedding additionality and development impact in all of our activities and demonstrating linkage to PIDG’s areas of strategic priority.
First, a number of go/no-go assessments are in place. All projects must be in line with PIDG’s climate change policy which excludes all coal projects and which states that non-renewable energy projects will only be acceptable under specific circumstances. Any energy project which does not incorporate a renewable or sustainable source must be escalated for consideration (for example, whether there is an exceptional economic or humanitarian argument for some sort of non-renewable source for baseload power in a particular location). Independent experts will be consulted for their views in these cases. These projects will be referred to the PIDG Board for a decision and the decision advised to the Owners.
For each project, PIDG’s additionality must be clear, and PIDG must be able to indicate how this can be evidenced. If the additionality is weak, the project will not be supported.
For each project, a clear pathway to impact must be articulated in the investment paper. If the pathway to impact looks weak, the project will not be supported.
Each investment paper must explain how that particular project is expected to have an impact on women and girls. If positive demonstration of gender equality enhancement is not sufficiently well understood, the project may not be supported. This approach is to be applied to disability as and when we have refined the methodology.
For each project, it must be clear that systems are, or will be, put in place to ensure that operations will be in compliance with IFC Environmental and Social Performance standards and PIDG’s Environmental and Social Management System, for example on working practices, community, health and safety, and environmental issues. If PIDG cannot obtain assurance on this, the project will not be supported.
Projects are scored on the different elements of their development impact. The scoring system varies by PIDG company because they have slightly different impact pathways. For InfraCo Africa, for example, the score includes categories on alleviating poverty (including the number and income level of people reached); prioritising frontier markets; mobilising investment; and enabling economic development. For GuarantCo, the categories are geography; sector impact; currency; catalytic effect; and financial structuring and innovation.
PIDG monitors and reports on projects’ development impact milestones and results. Additionality is also assessed closely and scored by individual companies to ensure that PIDG is doing something that others cannot or will not do. A sample of projects will be subject to in-depth evaluations to understand their impacts (expected or unexpected, positive or negative).
Together, these processes provide a framework for ensuring that all projects are aligned with the PIDG strategy and enable us to assess value for money.