A legal study of the Asian Infrastructure Investment Bank's new Environmental and Social Framework

The Asian Infrastructure Investment Bank's (AIIB) new Environmental and Social Framework (ESF) features a relationship of heritage and innovation, compared with the ESF of the World Bank and other multilateral development banks (MDBs). The innovative elements are not only embodied in a few specific institutions shiny with traditional Asian wisdom of 'voluntarism, flexibility and incremental progress' but are also observed in the AIIB's frontier environmental, social and governance portfolio investments in global capital markets. Drawing upon the World Bank, the alternative use of client systems enables the AIIB to maintain high and feasible standards, without having to intervene in national politics. In the Project-affected People's Mechanism, three-complaint resolution functions are streamlined under one roof, catering for the nature and degree of seriousness of the dispute involved and marking a major innovation in the design of an accountability mechanism among leading MDBs. The two requirements of exhaustion of project-level remedies and free, prior and informed consultation expect to function equivalently to the World Bank standards in effect, although they appear to reduce the protection of project-affected people.