Large infrastructure projects and investments in mining and other extractive industries can transform a country’s economy. However, experience around the world has shown the impacts of such projects are not evenly distributed. While the benefits may accrue to the country as a whole, or to a specific sector or region, negative impacts typically fall disproportionately on local communities, including displacement, loss of access to key resources, and disruption of livelihoods and of traditional practices. In an effort to mitigate negative impacts, many projects include compensation and liveli hood restoration to affected people, as well as investments in local infrastructure and sup port for new livelihoods. These measures are important, but it has become clear in recent decades that communities deserve more—and that it is in the interest of projects to do better to avoid fueling opposition that drives delays, increased costs, and even conflicts. The concept of “benefit sharing” emerged from this recognition. Though there is no sin gle definition of the term, in development, it is generally understood as a framework for governments and project proponents to maximize and equitably distribute benefits among stakeholders, with special attention to people who are adversely affected. While impact mitigation efforts try to ensure that projects do no harm, benefit sharing seeks to deliver value to project host communities. Benefit sharing can help increase social acceptance of projects, enhance their overall socio-economic benefits, help them make a more lasting impact, and help ensure a “just transition” in the context of investments in clean energy and low-carbon development. These aspects are particularly relevant at this moment in history where most economies around the world have made pledges to invest in a green energy transition and econom ic recovery after the COVID-19 pandemic. Aiming to advance knowledge of benefit sharing and promote its effective implementa tion across the World Bank Group (WBG), the Social Sustainability and Inclusion Global Practice conducted an in-depth study in 2021 to assess how benefit sharing is reflected in WBG policies and guidelines and how it contributes to achieving WBG objectives, to distill insights from WBG projects in different sectors and regions, and to provide recom mendations for the WBG’s future work. This report, which also includes detailed case studies, is the first comprehensive review of benefit sharing conducted within the Bank; previous studies have focused on specific sectors only. The goal is to provide a broader perspective, drawing on the experiences and insights of WBG specialists across sectors and countries, and to invite reflection and further discussion on options for the Bank’s future engagement.

Benefit Sharing in World Bank Operations: Prioritizing Development for Local Communities

Resource Key: C79R6JSL

Document Type: Report

Creator:

Author:

  • Erik Caldwell Johnson
  • Federica Cimato

Creators Name: {mb_resource_zotero_creatorsname}

Place: Washington D.C.

Institution: World Bank

Date: May 2024

Language: en

Large infrastructure projects and investments in mining and other extractive industries can transform a country’s economy. However, experience around the world has shown the impacts of such projects are not evenly distributed. While the benefits may accrue to the country as a whole, or to a specific sector or region, negative impacts typically fall disproportionately on local communities, including displacement, loss of access to key resources, and disruption of livelihoods and of traditional practices. In an effort to mitigate negative impacts, many projects include compensation and liveli hood restoration to affected people, as well as investments in local infrastructure and sup port for new livelihoods. These measures are important, but it has become clear in recent decades that communities deserve more—and that it is in the interest of projects to do better to avoid fueling opposition that drives delays, increased costs, and even conflicts. The concept of “benefit sharing” emerged from this recognition. Though there is no sin gle definition of the term, in development, it is generally understood as a framework for governments and project proponents to maximize and equitably distribute benefits among stakeholders, with special attention to people who are adversely affected. While impact mitigation efforts try to ensure that projects do no harm, benefit sharing seeks to deliver value to project host communities. Benefit sharing can help increase social acceptance of projects, enhance their overall socio-economic benefits, help them make a more lasting impact, and help ensure a “just transition” in the context of investments in clean energy and low-carbon development. These aspects are particularly relevant at this moment in history where most economies around the world have made pledges to invest in a green energy transition and econom ic recovery after the COVID-19 pandemic. Aiming to advance knowledge of benefit sharing and promote its effective implementa tion across the World Bank Group (WBG), the Social Sustainability and Inclusion Global Practice conducted an in-depth study in 2021 to assess how benefit sharing is reflected in WBG policies and guidelines and how it contributes to achieving WBG objectives, to distill insights from WBG projects in different sectors and regions, and to provide recom mendations for the WBG’s future work. This report, which also includes detailed case studies, is the first comprehensive review of benefit sharing conducted within the Bank; previous studies have focused on specific sectors only. The goal is to provide a broader perspective, drawing on the experiences and insights of WBG specialists across sectors and countries, and to invite reflection and further discussion on options for the Bank’s future engagement.

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