ES risk management in Finnvera’s export financing operations
Environmental and social risk management in Finnvera’s export financing operations
We assess all export guarantee applications to determine the level of environmental and social risks associated with the project. The scope of the risk assessment depends on the value of the transaction, the size of the project, project risks and on the type of the financing. As a rule, the risks associated with the entire project are assessed, even if Finnvera’s export financing is granted only to a small component of the project, or to a delivery of individual equipment.
The main steps of the process are:
- Screening
- ES risk classification
- Assessment
- Financing decision and monitoring.
In our risk assessment we follow the OECD Common Approaches, which sets out shared principles and procedures for assessing and managing the environmental and social impacts of projects supported by officially supported export credits.
Aligned with the OECD Common Approaches, we apply the IFC Environmental and Social Performance Standards and the World Bank Group Environmental, Health, and Safety Guidelines, including general and sector-specific guidance. Finnvera’s management of environmental and social risks is also guided by international treaties ratified by Finland, national legislation, Finnvera’s own policies and internal sector guidelines. Read more about Finnvera's Code of Conduct and Finnvera's Environmental and Social Risk Management Policy.
Environmental and social risk assessment is part of our financing decision-making process. For projects with OECD risk level high or medium, a separate climate risk assessment is included. Projects with more positive climate impacts may also be eligible for Finnvera’s sustainable finance solutions.
In accordance with the OECD Common Approaches, we make public disclosure on high-risk, Category A projects prior to final commitment. If financing is granted, we monitor these projects throughout their financial life cycle, until full repayment. We also promote transparency by publishing information on transactions for which Finnvera has provided guarantees.
Our environmental and social risk management is risk-based and covers all export financing products, including both corporate and project finance products. Elevated transaction-specific risks require a more comprehensive due diligence process and more detailed environmental and social requirements. Such risks that trigger enhanced environmental and social due diligence obligations include significant human rights impacts, a project’s location in a sensitive area, or potential impacts on such an area, including areas of global importance for biodiversity, protected areas, significant wetlands, or areas of importance to Indigenous Peoples or other vulnerable groups.
Find out more about Finnvera’s management of environmental and social risks by the headings below.
Published projects
In addition, in line with the OECD agreement, Finnvera publishes information on the A and B category projects to which it has committed during the year on the Guaranteed transactions page. The information to be published for Class A projects can be the same as in the pre-publication case, supplemented by more detailed information on export financing.
In addition, Finnvera also strives to publish information on other projects, regardless of the ES risk category. A brief summary of the key environmental and social aspects of the projects may be provided. The publication also covers information on the background material of the assessment and the international standards used. Publications are made with the consent of the parties.
In compliance with OECD agreements, Finnvera releases details about Category A projects, such as project name, location, project description, and information on where to access additional materials (e.g., ESIA report or summary), no later than 30 calendar days before a final commitment to grant official support. Finnvera also conducts Environmental and Social due diligence of the project and welcomes any additional information and comments.
