Environmental & Social Policy

1. Credit Guarantee and Investment Facility (CGIF), a trust fund of the Asian Development Bank (ADB) was established to promote economic development and resilience of the financial markets in ASEAN+3 countries through a sustained development of deep and liquid local currency and regional bond markets. This Environmental and Social Policy² (the “Policy”) has been enhanced to ensure that CGIF achieves this objective while promoting environmental and social (E&S) sustainability and enhances the capacity of the Issuers (as defined in para. 3) to implement an environmental and social management system (ESMS) to assess and manage the E&S risks and impacts of the activities financed with the support of CGIF’s guarantees. The objective of the Policy is to adopt in all respects with the environmental and social requirements for Financial Intermediaries³ as detailed in ADB’s Environmental and Social Framework (“ADB ESF”) (November 2024) Part IV (J) Environmental and Social Requirements for Financial Intermediaries⁴ and this Policy shall be understood and applied accordingly.⁵
   
   
2. Pursuant to the enhanced Policy, CGIF will update and implement a risk-based adaptive management approach in our internal procedures for assigning a risk classification, reviewing, assessing, monitoring, and implementing transactions supporting project or corporate financing, to ensure compliance with the Policy. The E&S Directives (“the Directive”) will establish the requirements for environmental and social screening, risk classification and due diligence procedures for transactions, and the required monitoring processes throughout the life of a transaction to ensure ongoing compliance to the Policy. CGIF will ensure that the assessment and management of E&S risks will be proportionate to the nature and scale of the risks and impacts of the transactions.
   
   
3. CGIF will work with its prospective guaranteed bond issuers (the “Prospective Issuers”) and its outstanding guaranteed bond issuers (the “Outstanding Issuers”) to ensure and enhance effective management of environmental and social risks by:
   
   • ensuring that the Policy is complied with for all guarantees issued;
   • guaranteeing bonds for projects only when the projects are required to be designed, constructed, operated, and maintained in a manner consistent with the Policy;
   • guaranteeing bonds for corporate⁶ use only when the Prospective Issuer has already implemented, or is committed, to implement, an environmental and social management system (ESMS) consistent with the Policy, across the transaction or operations being supported by the Guarantee;
   • requiring environmental and social risk identification and management to be integrated into the Outstanding or Prospective Issuers’ internal risk analysis to strengthen their E&S management systems including incorporating climate risk considerations;
   • requiring Prospective and Outstanding Issuers (together, the “Issuers”) to adhere to the Policy; and
   • ensuring appropriate consultation and disclosure, as applicable, with stakeholders for all bond guarantees consistent with the Policy.
     
     
4. The Policy and its associated Framework apply to all Outstanding Issuers and Prospective Issuers. CGIF will not issue a guarantee unless the Prospective Issuer has agreed to comply with the Policy and the host country’s social and environmental laws and regulations, including international laws adopted/ratified by the host country. In addition, CGIF will not issue a guarantee if the Prospective Issuer’s activities which are to be financed by the bond are included in ADB’s Prohibited Investment Activities List in its most recent version (“PIAL”).

1 This Policy apply to all CGIF bond guarantees for which application is made after 1 January 2026. The revised Environmental and Social Policy was endorsed by CGIF’s Board on 28 August 2025 and is available at www.cgif-abmi.org.
2 This Policy is an update and enhancement of the original Environmental and Social Safeguards Policy approved and released in October 2018.
3 CGIF was established as a Financial Intermediary of ADB as detailed in the Report and Recommendation of the President dated March 2010 and available at https://www.adb.org/projects/44908-014/main#project-pds
4 https://www.adb.org/sites/default/files/linked-documents/esf-complete-set.pdf
5 This Policy will be updated as appropriate, which will be released on CGIFs website, following such updates, if the underlying ADB ESF is updated or if at any time it becomes apparent that the Policy does not meet the stated objective.
6 Corporate bonds are defined as any general-purpose bonds to corporates or financial institutions that are not Project Bonds.