World Bank updates procurement policy to enforce gender-based violence rules

WASHINGTON — The World Bank has taken what some call a step forward in its efforts to combat gender-based violence — this time through a new procurement policy that would effectively ban contractors on a small subset of projects found to violate its rules for two years.

The World Bank has set “extensive” obligations on contractors related to social risks, and in the past four years has “ratcheted up requirements” in the procurement process, creating a new standard for what contractors must do to prevent and address gender-based violence, Galina Mikhlin-Oliver, the World Bank’s chief policy officer, told Devex.

While it’s great to have recommendations, “you have to have requirements to also make sure that there is real accountability,” Mikhlin-Oliver said.

The World Bank grappled with how it could do so, and after studying the new gender-based violence contract requirements for nearly two years looked for a way to “raise the stakes for noncompliance of obligations” and “make sure this is taken very seriously and incentivize contractors to seriously and truly comply with them,” she said.

The result is a new mechanism for about 10% of the bank’s infrastructure projects — those determined to be high risk — which for all contracts starting Jan. 1 will be subject to the new rules and be more closely monitored. If the contractor is found to be in violation of gender-based violence policies, they could be disqualified from bidding on World Bank contracts for two years. It is the first time a multilateral development bank is implementing such a policy, the World Bank said.

The new policy, announced last week, is the latest in a series of changes made by the World Bank to reduce gender-based violence in part as a response to a bank-funded transportation project in Uganda, where construction workers were accused of sexual abuse against children and women. The bank eventually canceled the project, and among other response measures, created an independent task force to examine its policies and make recommendations for how the bank could improve, including examining contractor accountability.

“In a general sense it’s a welcome step forward by the World Bank and I hope others will follow suit, ensuring more accountability for gender-based violence,” said Aria Grabowski policy and advocacy manager, the International Center for Research on Women.

How it will work

The risk of abuse is “inherent” in large infrastructure contracts and the bank has sought to counter that over the past three years, updating procurement documents and qualification requirements in the bidding phase and adding contractual requirements and remedies, Enzo De Laurentiis, the World Bank’s chief procurement officer, told Devex.

Contracts now include specific requirements, including the disclosure of previous incidence, having a code of conduct, ensuring qualified personnel are tasked with social and environmental issues, and a grievance mechanism to receive complaints, he said.

“We have a lot of different requirements to make sure risks are prevented and are managed quickly if they happen,” De Laurentiis said.

These high-risk projects will be overseen by a three-person independent panel, a dispute avoidance and adjudication board, that will do ongoing compliance reviews, including quarterly visits to monitor site compliance. The members of the panel will be approved by the bank and the contractor, and cannot come from the country where the company is based or where the work is being done, he said.

If the board finds that a contractor is not in compliance, the contractor will have an opportunity to fix the problem but if it is not fixed or there is an incident or allegation during the period of noncompliance the board can issue a finding. The board has the power to make legally binding decisions and can propose solutions or further actions.

If the board determines the contractor is not in compliance, the contractor has an opportunity to appeal through an expedited arbitration process. If the board’s decision is affirmed, then the World Bank will issue the two-year disqualification. After that period the contractor would have to demonstrate that it could manage and prevent risks and say what it had done to improve its capacity, De Laurentiis said.

The new system, particularly the special dispute boards, has a cost — one shared by the bank and borrowers. The World Bank will be evaluating it closely and there is potential merit for it to be used more widely, especially for larger contracts, she said.

Some concerns

The policy is a step in the right direction, several gender experts told Devex, but they also raised a few concerns.

“A big concern we always have with any of these kinds of policies is that they can disincentivize reporting,” Elana Berger, the executive director of the Bank Information Center, told Devex. But the bank’s focus on violations of policy rather than individual cases that are identified is a good thing, she said.

The new system could also disincentivize the bank to categorize projects as high risk. The Uganda project that led to the bank’s overhaul of its gender-based violence policies was not classified as high risk, Berger said, adding that projects like that could slip through the cracks, even though the World Bank has reworked its systems for determining risk.

Another concern from a number of advocacy organizations is that the policy applies only to a narrow group of projects.

The new policy seems “a little narrow in its scope,” and it would be good to see a similar policy applied to the World Bank Group’s whole portfolio, including the International Finance Corporation, even if the mechanism would need to be tweaked for that context, Grabowski said.

It makes sense perhaps to focus on high-risk projects as the bank stands up the new policy but it should “scale up,” Grabowski said.

The task force recommended that the World Bank should first adopt such a mechanism in high-risk environments, so this policy is a “good start,” Geeta Rao Gupta, senior fellow at the United Nations Foundation, who co-led the task force, told Devex.

“Our approach on the task force was one of trying to make this doable and set a standard not just in the bank but with all of its partners, this certainly does that,” she said. “It is ideal if it happens in all settings, but it’s good to begin here.”

“I’d like to see it play out once it’s implemented,” Gupta said, adding that she’d like to see the impact the policies have on industry standards, including for other multilateral development banks and for infrastructure contractors. Others also said that the proof will be in the execution, with the World Bank officials noting it would be monitored closely.

Berger said she’s concerned that the new system will not be responsive enough to community concerns and “doesn’t seem well-designed for community and civil society organization input.”

“The bank wants to be seen as a leader but the reason they are forced to be is pressure from communities, civil society organizations, and a board horrified by what happened in those previous cases,” Berger said. “The fact that they continue not to center communities and local CSOs who find these issues, that shows there is a certain lesson that they haven’t been willing to learn yet.”

Still, as the first mechanism of its kind for a multilateral development bank, there are hopes that it could be expanded or translated to other social or environmental issues, Berger said.

“It is groundbreaking that they’re doing it and the fact that they are choosing to do it on gender-based violence is meaningful and sends a signal of how important they see gender-based violence for their work,” she said.