Environmental and Social Management Systems (ongoing project)

The implementation of Environmental and Social Management Systems (ESMS) is one of the flagship areas of the eco.business Development Facility. ESMS are composed of a set of tools, policies, and procedures used during a credit-awarding process designed to identify the potential environmental and social risks associated with a client or project of a financial institution. Up to November 2022, the DF has assisted the following 14 PIs in the process of designing, evaluating, improving, or implementing their ESMS.  

• Banco Hipotecario, El Salvador 
• Banco Cuscatlán, El Salvador 
• Banco Atlántida, El Salvador 
• Banco Lafise, Nicaragua 
• Multibank, Panama 
• Global Bank, Panama  
• BICSA, Panama  
• Banco del Pacífico, Ecuador 
• Banco Guayaquil, Ecuador 
• Banco Pichincha, Ecuador 
• Banco Produbanco, Ecuador 
• Banco Promerica, Costa Rica 
• Cooperativa de Ahorro y Crédito Pacífico, Peru 
• Unifin, Mexico 

Following the positive experience of two of the largest Ecuadorian banks, the national banking association, Asobanca, requested the DF to host training sessions on ESMS for the rest of its members. Parallelly, the DF developed E&S Guidelines in partnership with Asobanca for 12 of the most representative crops and agricultural activities in Ecuador. These guidelines instruct local banks in enhancing their E&S risks and mitigation strategies, as well as identifying new, sustainable business opportunities within important sectors of Ecuador’s economy. The Sustainability Academy has sponsored a series of trainings on the use of the sectorial guides as a tool to identify E&S risks. As part of Asobanca’s sustainability committee, the Interamerican Development Bank (IDB) learned about the impact of the DF’s partnership with the association, sparking IDB’s interest in partnering with the DF to implement a similar project with ABANSA, the Salvadorian national banking association. In 2022, the DF sponsored a series of trainings to members of ABANSA on the importance of ESMS.  

The Development Facility also partnered with NINT, a regional leader and expert in sustainable finance, to develop a three-part manual in Spanish and Portuguese on how to design, implement, and pilot an ESMS. This manual represents a useful tool for financial institutions in the region that are interested in implementing or improving their ESMS.