Source · Select Committees · International Development Committee
Recommendation 22
22
Accepted in Part
Paragraph: 116
Mandate BII to transparently report detailed financial, impact, and fossil fuel investment data annually.
Recommendation
BII must prioritise the monitoring and reporting of investment activity and transparently report its financial and impact data. This should include, but not be limited to: (a) the number and type of jobs created, (b) types and value of capital mobilised, (c) the 2X Challenge assessment of its portfolio according to the five 2X Challenge criteria, (d) how the 2X classification has improved an investee company above employment levels currently found in the market for a given country. BII must also adhere to publishing a full annual listing of its investments in coal, oil and gas so an external assessment can be made on its progress against its Climate Change Strategy and a net zero portfolio, as previously recommended within our 2021 report on UK Climate Action and International Development around COP26. The data should be complete for all BII’s investments, published in a timely manner and allow for comparability over time. Where investments have not achieved their planned annual impact outcomes, BII should disclose the reasons for any short-comings and set out its plan for recourse.
Government Response Summary
The government partially accepts, agreeing on the importance of monitoring and reporting. BII will publish a Transparency Roadmap and begin disclosing qualifying criteria for new 2X investments, while already reporting on some impact data. However, it does not explicitly commit to publishing a full annual listing of fossil fuel investments or plans for recourse for shortcomings.
Paragraph Reference:
116
Government Response
Accepted in Part
HM Government
Accepted in Part
Partially Accept The Government agrees with the importance of BII prioritising the monitoring and reporting of its investment activity and financial and impact data. BII ensures transparency by reporting all its investments on a public database available on BII’s website. This includes the amount committed, details about the investee, and the anticipated development impact. To further strengthen transparency, BII will publish a Transparency Roadmap before the end of 2023. This will articulate BII’s ambition to be the most transparent bilateral development finance institution as measured by the Publish What You Fund transparency index, as well as specific short-term actions to deliver on this ambition. At a portfolio level, BII already reports against subcategories a) and b) above. For example, in 2022 BII’s investments supported 54,000 additional jobs and BII mobilised $1.35-$1.41 billion of private-sector capital. Moreover, 50% of BII’s 2022 investments were gender-focused investments into 2X-qualified businesses and fund managers. All BII’s 2X qualified deals are published on an annual basis on BII’s website and form part of BII’s Annual Review which is also published online. Typically, 2X qualifications are also included within investment announcements on BII’s website, including which criteria the deal qualified under in line with Recommendation c) above. As part of the Transparency Roadmap, BII will also begin disclosing the qualifying criteria for each new 2X investment. For sub-category d), BII will continue to provide in its Annual Review and other publications examples of how 2X-qualified investments have created positive outcomes for women and girls – providing outline for best practice and learning for the industry. For example, BII’s investment in Kashf Foundation, a microfinance institution that provides finance to female entrepreneurs in Pakistan, has enabled the business to expand its customer reach from 490,000 in 2020 to 639,000 customers by end 2022. Moreover, increased disclosure requirements for 2X qualifications are being set by 2X Global as part of the next phase of the 2X Challenge. BII, together with its 2X DFI peers, will adhere to these new requirements as they are introduced.