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ADB's Environment Policy should be revised to allow greater flexibility in procedures and recognition of the need to align with the systems of its member countries, according to a new report.

The report, by the Operations Evaluation Department (OED) on ADB's Environmental Safeguards, says that while the principles and objectives of the policy remain valid, ADB's current approach, involving a uniform set of environmental procedures, is no longer an effective response to the needs of its developing member countries or its own limited resources.

ADB should place more emphasis on capacity building country systems, and complement procedural compliance with a greater focus on results delivery and cost effectiveness. But the task of adopting improved country systems will be a gradual and long-term process, the report emphasizes, during which ADB should not compromise its stringent safeguards standards.

ADB has three safeguard policies - on involuntary resettlement (1995), indigenous peoples (1998) and environment (2002) - that have guided ADB in the planning of undertaking of its assistance, particularly its loan projects.

OED, which functions independently of ADB's management and reports direct to its Board, was requested by the ADB Board's Development Effectiveness Committee to evaluate environment safeguards ahead of a review of ADB's Environment Policy.

The study focuses on how safeguards relate to results on the ground, particularly in terms of environmental impact of ADB-supported projects.

Sixteen projects in four countries – People's Republic of China, India, Philippines, and Viet Nam – were included in the case studies. These countries accounted for almost 45% of ADB's lending between 1996 and 2005. The 16 projects encompassed a cross section of ADB activities.

The study found significant variance among developing countries in terms of the comprehensiveness and effectiveness of national environmental systems and in their ability to deliver results.

"A key conclusion of the evaluation study is that a 'one size fits all' approach is not effective given the diversity of environmental issues and varying strengths in ADB's developing member countries," says C.C. Yu, ADB Senior Evaluation Specialist who was team leader for the study.

"There is likely to be a progressive shift in the future to more reliance on national systems. This would require new assessment processes to ensure that these countries' practices, both at the policy level and as implemented are consistent with the principles and objectives of ADB's environmental safeguard policy. ADB will need to complement its project focus with a greater emphasis on building capacity."

The report says that such a change in policy should be "more evolutionary than revolutionary" and respond to the changing situation in those countries that have relatively more developed procedures and systems.

It recommends that ADB develop an action plan to implement the Environment Policy, when revised, taking into account the resources that will be needed to ensure the integrity of environmental safeguards.

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