The International Finance Corporation (IFC) invested $120.6 million in TITAN Cement Egypt in 2010 to support the expansion of the company’s plant in a residential area, Wadi Al Qamar, about a 30-minute drive west of Alexandria city. Nearby residents had long suffered from the looming presence of the cement plant, and the expansion threatened even more harm, including more environmental and noise pollution.
Over years of exposure, residents — including children and infants — suffered severe health consequences, many developing chronic lung diseases such as pulmonary fibrosis. Beyond the airborne pollution, the relentless operation of heavy machinery and grinders generated severe structural noise and vibrations powerful enough to cause visible cracks in nearby residential buildings. The residents organized protests and sit-ins, appealed to Egyptian officials, and filed a lawsuit. With little result, they ultimately submitted a formal complaint in 2015 to the internal compliance mechanism of the IFC, the Compliance Advisor/Ombudsman (henceforth ombudsman).
By the time investigations concluded in 2019, the IFC decided to divest. The investigations had revealed that, even though the company didn’t have the necessary national environmental operating licenses, that requirement was deferred by the IFC under undisclosed legal provisions in their confidential agreement with the company. Among the impacts, the newest kiln that the company had built within a short distance from the houses, in violation of the Egyptian environmental regulations, emitted heavy cement dust that blanketed Wadi Al-Qamar.
The case illustrates a persistent pattern of undisclosed waivers and deferrals that the IFC should address in its current review of its Access to Information Policy, begun early this year and expected to conclude in 2028. Such reform is especially crucial as the annual investment commitments of the IFC, which is part of the World Bank Group, reached a record $105 billion in fiscal year 2026, up from $33 billion in fiscal year 2022, paving the way for its total active investment portfolio to grow 40 percent to an estimated $147 billion over the coming years under its 2030 strategy.
By granting such waivers and deferrals, the IFC was overriding its own “performance standards,” a set of rules designed to ensure that financed projects do not incur serious environmental harm, displace communities or jeopardize public health. Granting a deferral or waiver prior to signing and continuing to extend those exceptions afterwards means that the decision and any justifications remain confidential and out of sight of the public. This also contravenes the IFC’s Access to Information policy, which establishes that the public — both those taxpayers providing the IFC’s funding and those affected by the corporation’s projects — has a right to know what is being financed and how risks are being mitigated. In projects that are classified as “high-risk,” those mitigation measures and their estimated date of completion are recorded in an Environmental and Social Action Plan (ESAP). But this policy includes caveats that act as structural loopholes for keeping “commercially sensitive and confidential information” secret. A waiver or a deferral — usually granted according to the IFC’s Environmental and Social Review Procedures (ESRP) — also serves as a free pass for commercial clients of the IFC to delay or bypass the legally binding environmental and social requirements to “permit certain investment operations to proceed.”
A Paucity of Public Disclosure
My own examination of 15 IFC investments that the corporation approved between 2021 and 2023 and classified as having significant environmental and social risks reveals that only eight projects have publicly disclosed their progress against ESAP milestones, and only two of those included their completion dates. Furthermore, whenever the IFC does disclose an updated version of an ESAP, the previous versions are not disclosed. For example, one of the examined ESAPs was titled “version 6,” meaning there were five previous versions that were not disclosed. If the anticipated deadlines or any environmental and social initial commitments are altered, there is no way to find out, as the public is barred from accessing previous versions.
As the IFC’s ombudsman highlights in an advisory note this year, the corporation apparently grants waivers without reconfirming environmental and social commitments to pending actions, which in turn heightens risks. If an initial commitment is waived or an initial deadline for a commitment is extended, the public has no way of knowing, because these details would disappear once an updated version of an ESAP is published.
The IFC also invokes non-disclosure agreements (NDAs) beyond the actual legal agreements signed with its borrowers and the waiver requests that it grants. It does so in instances when information requests are denied under the stated rationale of protecting “commercially sensitive and confidential information,” even in instances where this information falls outside standard commercial secrets.
In 2017, for instance, a Filipino civil society organization filed a complaint to the IFC in relation to its investment in the Rizal Commercial Banking Corporation (RCBC) on behalf of several communities living in the proximity of 19 active or proposed coal-fired power plants in different parts of the Philippines, all financed by the bank. The complainants alleged that the bank provided financial support to the plants without securing any guarantees that they would operate in accordance with the IFC’s Performance Standards, citing serious environmental and social risks and impacts.
The IFC’s management responded by commissioning a “management action plan” to conduct a gap analysis and propose remedial measures. The report was never published, and when civil society submitted a request to access the report, the IFC denied the request, as did its appeals panel, which upheld the denial based on an NDA signed with both the commercial bank and the consultant who prepared the report.
Private Capital – With Weak Regulatory Oversight
Institutions like the IFC are established to leverage private capital to drive economic growth and job creation. The World Bank also relies heavily on private investments as part of its development strategy for “Fragile, Conflict and Violence-affected” settings. But in many cases, these investments occur within — and take advantage of — contexts with weak regulatory oversight, and they often end up deepening the vulnerabilities of local communities and marginalizing them further. In the case of TITAN Cement Egypt, not only did the IFC investment exacerbate environmental harm, but it also infringed on the community’s health and livelihood, according to the ombudsman.
Furthermore, the IFC continues to invest in companies with records of causing harm, many of which were and are under investigations by the ombudsman. While the IFC punishes companies for financial violations by barring them from future investments for a set period, environmental and social violations do not receive the same treatment. By being lenient on these violations — and covering them up under non-disclosure agreements and the pretext of “commercial sensitive information” — the IFC acts more like a commercial bank that prioritizes client satisfaction and profits over its mandate as a development bank.
As the IFC reviews its Access to Information policy while gearing up to play an expanded role in the World Bank Group’s strategy, it should establish responsible transparency with serious reforms, including ensuring strict adherence to a do-no-harm policy in every clearly defined exception. Furthermore, the public interest should always be prioritized and should outweigh any real or perceived commercial harm. Waivers and deferrals should be prohibited when they risk or undermine public safety, fundamental human rights protections, or compliance with national environmental laws.
