IFC Performance Standard 7

PS 7: Indigenous Peoples

IFC PS 7 IconIndigenous people can be defined as: “a distinct social and cultural group processing the following characteristics in varying degrees: Self-identification as members of a distinct indigenous cultural group and recognition of this identity by others; Collective attachment to geographically distinct habitats or ancestral territories in the project area and to the natural resources in these habitats and territories; Customary cultural, economic, social, or political institutions that are separate from those of the dominant society or culture; An indigenous language, often different from the official language of the country or region.

FPIC: Consultation that is free of intimidation or coercion provides timely disclosure of information and is relevant, understandable and information is accessible. Consultation should continue through the entire life of the project and not only during the early stages of the project.

“Good faith negotiation” is a Documented process of negotiation and outcomes of negotiation that generally involves (i) willingness to engage in a process and availability to meet at reasonable times and frequency; (ii) provision of information necessary for informed negotiation; (iii) exploration of key issues of importance; (iv) mutual acceptable procedures for the negotiation; (v) willingness to change initial position and modify offers where possible; and (vi) provision for sufficient time for decision making.

Key Questions to be addressed during due diligence:

Avoidance of Adverse Impacts

  • Is it likely that Indigenous Peoples (IPs) will be adversely impacted as a result of the project?
  • Does the E&S Impact Assessment identify the adverse impacts to IPs respectively ways to avoid these to the extent possible?
  • If so, does the impact assessment contains an IP Action plan, i.e. a plan that details actions to minimize, and mitigate, and compensate for adverse social and economic impacts, and to identify opportunities and actions to enhance positive impacts?
  • Has the client compensated IPs in a culturally appropriate manner?

Consultation and Informed Participation

  • Has the client established a process for “Informed Participation” (keyword FPIC process) centered on mitigation measures and benefit sharing?

Impacts on Traditional or Customary Lands under Use

  • Has the client informed IPs of their rights?
  • Has the client offered compensation ? (land-based compensation or compensation-in-kind in lieu of cash compensation to be preferred)?
  • Has the client entered in good faith negotiations with affected communities?