How can looking after biodiversity help me fund my project?

The vast majority of development work needs some form of borrowing to get off the ground, and in many circumstances this is in the form of private loans.

The International Finance Corporation (IFC) can help businesses get access to private finance for projects. To determine which projects are eligible for funding, they apply a number of criteria, known as Performance Standards, to assess the environmental and social risks. Anyone who applies for credit with the IFC or their clients needs to adhere to their Sustainability Framework. These standards are also used by other financial institutions.

Performance Standard 6 (PS6) is Biodiversity, making it a central part of assessing whether a development is sustainable, and failure to meet this standard could mean that your project doesn’t get off the ground.

What are the objectives of PS6?

PS6 has three main objectives, each covering different key issues:

  1. To protect and conserve biodiversity, with key issues being:
    • Habitats
    • Protected areas
    • Internationally recognised areas
    • Invasive alien species
  2. To maintain the benefits of ecosystem services, with the key issue being:
    • Ecosystem services
  3. To promote the sustainable management of living natural resources, with key issues being:
    • International standards
    • Third-party certification
    • Supply chains.

What makes a development sustainable?

In terms of biodiversity, the IFC wants to make sure developments protect and conserve biodiversity, maintain ecosystems and manage living natural resources. This is particularly important in countries which are reliant on natural resources to provide livelihoods, but applies across the world as any loss of biodiversity can have a knock-on effect on ecosystems which contribute to the economic prosperity and development of people everywhere.

The IFC uses the term ‘ecosystem services’ to describe the benefits we all get from ecosystems, and breaks it down into four parts:

  1. The products we gain from ecosystems
  2. The benefits we get from the regulation of ecosystem processes
  3. The non-material benefits of ecosystems
  4. The natural processes which maintain other areas of biodiversity.

One of the aims of PS6 is to manage and mitigate the impact a development has on any of these ecosystem services.

How can I make sure I meet PS6?

The documentation needed for PS6 is detailed and can be overwhelming at first glance. Working with an environmental consultant makes this process much easier, as they will be able to use their knowledge and experience to complete the paperwork and advise you on the measures you need to take.

An environmental expert will have prior experience of IFC approval and will be able to work with them to ensure your proposal is taken seriously and that any risks are as minimal as possible. They will also have experience and contacts with other agencies involved in the approval process, including government bodies and frameworks supplied by other agencies.

As well as details about your project and what you’re hoping to achieve, your environmental consultant will be able to advise you about possible risks to biodiversity and the best ways to mitigate these risks in a cost-effective way.

The key things your environmental consultant will need to cover to ensure you are fully compliant are:

  • Critical habitat assessment – including habitat characterisation, rapid surveys, reporting and stakeholder consultation
  • Biodiversity management plan – to work as part of a wider Environmental and Social Management Plan (ESMP)
  • Biodiversity action plan – an IFC requirement to describe measures taken to ensure compliance
  • Biodiversity strategy – a broader strategy mainly for external stakeholders to refer to
  • Biodiversity monitoring and evaluation – measurements taken throughout the lifetime of the project
  • Biodiversity offset management plan – explaining what has been done to offset any environmental damage and how this will be maintained in the long-term.

Are there any other benefits to PS6?

Obviously, funding is the big issue for many developers. However, there are a range of other benefits, the most obvious being the environmental benefits. By complying with PS6, you will automatically be protecting local biodiversity and ecosystems – something which can be used to demonstrate to people that you are carrying out work in a responsible and sensitive way, and adhering to best practice.

You will also be prepared for any biodiversity-related issues which may have delayed or impeded work further down the line – by having your ecological consultant involved at the beginning of the process, you are aware of potential protected species or habitats from the start and can make the necessary amendments to your designs before it becomes more costly and time-consuming.


To discuss how to approach PS6 for your development, contact our environmental experts at Engain on 01225 459564 or email enquiries@engain.com

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