Imagine you are working on the IDB’s Flood Risk Reduction Program, a project which seeks to improve the country’s resilience to climate change by reducing the risk of floods in peri-urban areas in the Andes. The program includes studies that consider the effects of climate change and, based on the results, the identification, design and execution of works to reduce risk and adapt to climate change.
You lead the project team and are called to a meeting with a representative from the Government Irrigation and Waterways Department, responsible for loan preparation and execution, to discuss some of the social aspects identified thus far. The representative informs the team that, in several of the proposed sites, there are people who have occupied the river’s buffer zone, building houses, and even introducing commercial activities, such as animal farms.
The representative also tells us that they tried to implement this project a few years ago, but that there was a large-scale protest from some of the local communities in the program’s area of influence. Due to the local unrest, the government decided to postpone the project indefinitely. In this instance, they have taken the following steps:
- Develop a social baseline of the affected people, that only includes the people with legal rights to their plots.
- Based on previous experiences of similar projects, engage with landowners in the area, but not consider the informal settlers or other stakeholder groups affected by other impacts of the Program besides resettlement.
- Negotiate compensations with landowners according solely to the national law.
Based on this information, you recommend the government to develop a Social Impact Assessment (SIA) as an integrated part of the Environmental and Social Impact Assessment (ESIA) process. The SIA is the process of analyzing, monitoring, and managing the social consequences of a planned intervention, such as a program, project, plan, or policy. It should be reflected in project decision-making in all stages of the project cycle in order to maximize the benefits and minimize the social cost of an intervention. The SIA includes specific milestones, deliverables, reports, and plans at appropriate times during the project cycle. Therefore, it is not a study at a specific time resulting in a report, but rather a process.
Within the ESIA process (required for any project preparation) the resettlement impacts should be avoided, in first instance, and then reduced, following the mitigation hierarchy. The next step should be to evaluate the remaining impacts related to physical displacement (i.e. relocation, loss of residential land, or loss of shelter), and economic displacement (i.e. loss of assets or access to assets, including those that lead to loss of income sources or other means of livelihood). Furthermore, appropriate mitigation measures should be identified (i.e., compensation for land or other assets lost, relocation assistance) to restore, and even improve, the livelihood of the affected people.
What would you do?
For our project, the SIA would need to, among other things, assess the social context, making sure to identify all potential social risks and positive and negative impacts caused by the program’s activities and include adequate mitigation measures. Specifically, the team would need to prepare the resettlement and/or livelihood restoration plan for the affected people.
The team, after analyzing the information provided by the government, concludes that there is some data missing and that steps need to be taken to properly assess the social risks and impacts. A social baseline should include all the people affected by the different types of impacts (including resettlement) of the Program’s activities, paying particular attention to groups in situation of vulnerability (elderly, land-dependent farmers, informal occupants, etc.), as they may require additional mitigation and compensation measures. This would allow the team to have a better understanding of the project’s context and to develop a meaningful consultation and stakeholder engagement plan.
Basing the analysis on previous experiences with a particular group would grant the team a limited perspective on how a part of the community (and not necessarily the most vulnerable) has responded to similar programs in the past, not providing a holistic assessment that allows for a full understanding of the social context. However, this does not mean that the previous experiences should be discarded, of course. To identify and mitigate all negative impacts (not only resettlement) and enhance the positive ones, the team must understand the diverse groups of stakeholders within the area of intervention and their interactions.
Letting the government follow national laws without any further assessment to determine compensation measures could end up not even restoring the livelihoods of all affected people. There must be an assessment of the national regulatory framework as part of the SIA to identify if there are gaps when considering best practices and propose measures to overcome them, if required.
The team would also not have an adequate stakeholder analysis for the Program. Consequently, they would not engage in a meaningful consultation process with all affected and interested parties, and appropriate measures would not be included in management plans, for example, to at least restore the livelihoods of affected people by the resettlement. This outcome could have been avoided with a timely and thorough SIA.
What can you do?
If you would like to learn more about how to properly carry out an SIA process for any project, we invite you to visit our ESG Courses website and register for the SIA course. The course is free, and registration is now open. In about three hours of self-guided learning, with sections of theoretical learning and reality-based case studies, you will receive all the basic tools to address similar situations in your projects.
In this brand-new course, you will learn about the ten elements of an SIA and how to use them during the preparation and implementation of your project. This is in accordance with the guidelines presented in Section I of the international good practice note, Social Impact Assessment: Integrating Social Issues in Development Projects, prepared by the IDB in 2018. The course is now available in English only, but other IDB languages will be coming soon.