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Close to a hundred civil society organisations from more than 25 countries* today sent an open letter to all banks and financial institutions that have adopted the Equator Principles**, calling on them to drastically reform their seven year old initiative.

The letter, called Bold steps forward, towards Equator Principles that deliver to people and the planet', was coordinated by BankTrack, the international NGO network monitoring commercial banks. It was sent prior to a meeting which will take place next month between NGOs and banks that have adopted the Equator Principles.

The letter expresses severe disappointment with the performance and impact of the Equator Principles, considered by many observers as the leading sustainability initiative within the banking sector:

"We see a lack of spirit, of belief in the vast potential of the Principles amongst the very banks that have adopted them. We witness an inward looking initiative that continues to operate in secrecy, that has no internal strength to take on new challenges, or deal with issues which incorporation is already long overdue, and that continues to deny affected communities and other stakeholders their rightful place in the process"

The letter also points out that "we find ourselves continuing to campaign against the very same projects that we expected the Principles to prevent or significantly improve: supersized dams blocking life-supporting rivers, driving thousands of people from their submerged villages and lands; huge mining projects scarring entire mountains and polluting rivers and seas with their waste; oil and gas pipelines carrying their toxic load straight through devastated forests and threatening marine sanctuaries; coal power plants belching out millions of tons of greenhouse gases into our already fatigued atmosphere; enormous paper mills with insatiable appetites that devour the last wilderness areas, etc. Much to our disappointment, the Equator Principles allow for all of these disgraces to proceed, only now in an ‘Equator compliant' mode."

To improve the Principles so that they start to make a difference to people and planet the letter demands that adopting banks take immediate steps to:

1. open up, by improving the transparency of the Principles through full disclosure of banks' implementation efforts, on the project level, disclosure of all information related to a project's social and environmental impact.

2. be accountable, by improving the community consultation process, establishing guidelines for project grievance mechanisms, and establishing an accountability mechanism for the Principles themselves.

3. Expand the scope, by committing to apply the Principles, or an adapted version thereof, beyond project finance transactions to general corporate loans, asset management activities and Initial Public Offerings (IPOs).

4. Stop financing climate change, by developing exclusion criteria for projects and activities with a high impact on climate change, such as fossil fuel exploration projects and coal power plants, and by developing stringent climate targets for other projects financed ‘under Equator'.

"Our organisations have been in dialogue with the Equator Principles banks for six years," said Johan Frijns, BankTrack coordinator. "We regret to conclude that so far little has been achieved as a result of these talks. Without additional bold steps forward the Principles risk becoming pretty insignificant for global efforts to create a just and sustainable world"

"There is a crucial difference between ‘environmental risk management' and ‘managing risks to the environment,'" says Yann Louvel, campaigner with Les Amis de la Terre France; "With the Equator Principles, the emphasis is too much focused on managing risks for the institutions itself, rather than properly dealing with risks posed to the environment and local communities when financing projects"

"Transparency is key for the Equator Principles to make a difference on the ground," says Michelle Chan of Friends of the Earth US. "If Equator banks are not transparent about which projects they finance, how on earth is a local community supposed to know that a project is ‘under Equator', and that they have the right to be consulted and that their interests must be respected? This does not make any sense"

"There is something profoundly cynical about the notion of a large scale oil project that is ‘Equator compliant', but will nevertheless lead to millions of barrels of oil being extracted and ultimately burnt into the atmosphere," observed Andreas Missbach of the Berne Declaration in Switzerland. "The world does not need Equator-compliant oil extraction; such projects urgently need to be stopped altogether if we want to have a chance to avoid catastrophic climate change unfolding"