Why does IFC conduct due diligence before approving projects?

The reason the IFC conducts due diligence before approving projects revolves around the need to assess risks and ensure that the projects align with its mission and standards. This process is crucial as it involves a comprehensive evaluation of multiple factors, including environmental, social, and economic impacts. By thoroughly assessing risks, the IFC can identify potential issues and opportunities that might affect the project's success and its alignment with sustainable development goals.

This due diligence process also reinforces the IFC's commitment to supporting projects that not only generate financial returns but also contribute positively to the communities and environments in which they operate. Ensuring alignment with its standards is integral to maintaining the integrity of the institution and reinforcing its role as a reliable partner in fostering sustainable investments.