The financial and food crises arereminders of the growing challenges countries face insustaining economic growth and lifting the living standardsof the poor. Equally, the emerging impacts of global warmingon natural disasters and on agriculture are warning signs ofthe urgency to care for the environment and society. Recentglobal experience in the financial and environmental arenasdemonstrates clearly the need to put in place and enforceregulatory frameworks that balance costs and benefits, bothprivate and social. In this context, the crucial questionsin the recent evaluation by the Independent Evaluation Group(IEG) of the World Bank Group's safeguards andsustainability policy framework concern the effectiveness ofthe instrument in mitigating adverse environmental andsocial impacts of development programs, and suggesting waysto improve the results. IEG's evaluation coveredprojects approved from FY1999 to FY2008. During this period,social and environmental effects were significant in half ofWorld Bank projects 1,402 with commitments of $109 billion;88 percent of projects financed by the International FinanceCorporation (IFC)1,662 with commitments of $35 billion;and 217 guarantees by the Multilateral Investment GuaranteeAgency (MIGA). The main thrust of the evaluation findings isthat the World Bank Group's safeguards andsustainability policies have helped avoid or mitigatelarge-scale social and environmental risks in the projectsit financed, but many projects with substantialenvironmental and social impacts remain of concern primarilybecause of inadequate supervision and follow-up.
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