Can you fund projects linked to sectors with a bad reputation?
Our NL Business team has a wider sector mandate and can invest in sectors other than FMO's key sectors. The team financed a project involved in the transshipment of minerals from western Africa.
Mining in west Africa has been booming of late. However, several large mining projects have been having a significant negative environmental and social impact.
The shipment operations were not an issue, but the question remained: can you fund the shipment of minerals from a region whose mining sector has such a dubious reputation?
A wider view on impact
Though not financing mining ourselves, FMO decided to expand its environmental and social impact analysis to include the mining operations producing the minerals to be shipped.
Thanks to the mine’s cooperation, we could establish that its day-to-day operations, including its sustainability performance, are of a high standard. This was the reassurance FMO sought.
Digging deeper than reputations
By researching the wider sustainability risks beyond a project’s direct scope of influence, FMO can get a deeper understanding of a project’s impact. In some cases, like this one, this can empower us to support and encourage good practice within sectors and regions that are otherwise problematic.