www.ifc.org/thoughtleadership NOTE 110 • JAN 2022 Sustainability-Linked Finance— Mobilizing Capital for Sustainability in Emerging Markets By Raquel de la Orden and Ignacio de Calonje Sustainability-linked finance is designed to incentivize the borrower’s achievement of environmental, social, or governance targets through pricing incentives. Launched in 2017, it has now become the fastest-growing sustainable finance instrument, with over $809 billion issued to date in sustainability- linked loans and bonds. Yet these instruments are still nascent in emerging markets, which represent only 5 percent of total issuance to date. This note shares examples of recent sustainability-linked financing, including several involving IFC in various roles, to highlight how investors can utilize these new instruments in emerging markets and mitigate greenwashing risks. Sustainability-linked finance mobilizes capital to support the in 2021, when SLLs reached an annual issuance of $366 borrower’s improved environmental, social, and governance billion, or 181 percent above the 2020 volume of $130 billion. performance. These financial instruments incentivize the Most impressive were SLBs, the volume of which rose to $103 pursuit of sustainability targets by tying pricing—usually billion—i.e. 803 percent above 2020 figures; partly driven by through interest rates—to their achievement. Targets are the European Central Bank’s (ECB) decision to accept SLBs as typically related to corporate environmental, social, or collateral for Eurosystem credit operations and monetary policy governance (ESG) metrics. They should be ambitious and purchases, starting in 2021.2 aligned with the firm’s corporate sustainability strategy. 1600 Incentive structures can vary, including an increase (step-up) Green bonds 1400 Green loans in the interest rate paid by the firm if the target is missed, Social bonds a decrease (step-down) if the target is met, or both. The 1200 Sustainability bonds Sustainability-linked bonds underlying instrument can be any financial product, including 1000 Sustainability-linked loans bonds, corporate loans, project finance loans, revolving 800 credit facilities, derivatives, and others. The most popular instruments thus far have been corporate sustainability-linked 600 loans (SLLs) and sustainability-linked bonds (SLBs). For 400 example, Enel issued a five-year, $1.5 billion SLB in 2019 with 200 a 25 basis point interest rate step-up linked to a target of 55 0 percent renewable installed capacity by 2021.1 2017 2018 2019 2020 2021 Since their inception in 2017, over $809 billion of FIGURE 1 Sustainable Debt Annual Issuance, 2013–2021 sustainability-linked financing has been brought to market, of ($ billion) which 85 percent was SLLs. The market reached new heights Source: BloombergNEF, Bloomberg L.P. About the Author Ignacio de Calonje, Chief Investment Officer, Global Energy & Mining, IFC. Email: idecalonje@ifc.org Raquel de la Orden, Investment Analyst, Global Energy, IFC. Email: rdelaordenlopez@ifc.org 1 This publication may be reused for noncommercial purposes if the source is cited as IFC, a member of the World Bank Group. There are examples of sustainability-linked financing across Growth in Emerging Markets all industries. Of the $809 billion issued to date, 44 percent So far, emerging markets have accounted for just 5 percent was from companies in the manufacturing, agriculture, and of total sustainability-linked financing issuances.5 The services sectors; 39 percent was from infrastructure companies, Europe and Central Asia and North America regions including energy, telecommunications, transport, mining, and registered the highest debt volumes, with 54 percent and water; and 17 percent was from financial institutions, including 31 percent of total issuances thus far, respectively, followed banks, insurance companies, government agencies, and others. by East Asia (10 percent), Latin America (3 percent), and the Middle East and North Africa (1 percent).6 As of December 400 Infrastructure 2021, only $44 billion of all sustainability-linked debt 350 Manufacturing/Services issuance was in low- and middle-income countries. Financial Institutions 300 Yet the market in developing countries is growing. In 250 2021, sustainability-linked financing in emerging markets saw a 327 percent increase compared to 2020 volumes. 200 Mexico, China, Turkey, Russia, and Brazil led the way, with 150 approximately 82 percent of total volumes in non-high- income countries. There are also select examples elsewhere, 100 mostly in Asian countries such as India and Thailand. In 50 Africa, as in the rest of Latin America, market activity 0 remains limited thus far. 2017 2018 2019 2020 2021 Cumulative volumes (US$ billion) FIGURE 2Cumulative Sustainability-Linked Financing 0.1 9.5 by Sector, 2017–2021 ($ billion) Source: BloombergNEF, Bloomberg L.P. The rapid market growth of sustainability-linked financing across industries reflects the strong interest in these instruments by borrowers, investors, and regulators. Firstly, sustainability- linked finance allows borrowers to highlight sustainability commitments to their existing investor bases, while attracting a wider pool of investors interested in impact and sustainable investing. By doing so, companies may achieve a lower cost of capital, as well as an expanded and diversified investor base. These instruments also allow borrowers to better align their financial, operational, and sustainability objectives at a time © Australian Bureau of Statistics, GeoNames, Microsoft, Navinfo, TomTom, Wikipedia when sustainability has become a strategic imperative for most companies, given broader climate and societal concerns. Secondly, investors can leverage sustainability-linked finance to adopt a FIGURE 3 Cumulative Sustainability-Linked Financing “profit-with-purpose” business model. An increasing number of in Emerging Markets, 2017–2021 ($ billion) retail and institutional investors are making sustainability a core Source: BloombergNEF, Bloomberg L.P. criterion in their investment decisions, driven by investee demand. In addition, good ESG performance may also enhance shareholder SLLs have been the most popular sustainability-linked value, both in the short and long run, by increasing customer instrument in emerging markets so far, but SLBs skyrocketed loyalty, lowering climate risks, increasing staff productivity, in 2021 in line with global trends. The first emerging market and other factors.3 In fact, multiple financial institutions are SLL was issued by Polat Energy, a wind power investor in incorporating ESG performance into their credit rating systems, Turkey, in August 2018. Since then, $25.2 billion of SLLs have reflecting the positive impact that ESG can have on portfolio been issued in low- and middle-income countries. Nearly two quality. Finally, regulators are also keen to promote sustainability- years later, in September 2020, Suzano, a Brazilian pulp and linked finance as a tool to attract private investment toward paper company, issued the first emerging market SLB. Despite government objectives under the 2030 Agenda.4 the slow ramp-up, $18 billion was issued in 2021. 2 This publication may be reused for noncommercial purposes if the source is cited as IFC, a member of the World Bank Group. Environmental metrics Social metrics Governance metrics ESG ratings 30 Sustainability-linked loans 100 Sustainability-linked bonds . 25 80 20 . 60 15 . 40 10 . 5 20 . . 0 0 2019 2020 2021 2017 2018 2019 2020 2021 FIGURE 4 Cumulative Sustainability-Linked Issuance FIGURE 5 Evolution of Indicators in Sustainability- in Emerging Markets, 2018–2021 ($ billion) Linked Issuances, 2017–2021 Source: BloombergNEF, Bloomberg L.P. Source: BloombergNEF, Bloomberg L.P. Evolving Trends in Pricing, Metrics, and Most early debt issuances used carbon emission reduction Instruments metrics, but alternative social and environmental indicators Pricing structures are expected to evolve as the market for are surging. Corporate environmental metrics were used in 67 sustainability-linked financing matures. Ideally, the pricing percent of total issuances to date, with carbon emissions as the step-up or step-down should be commensurate with the most popular option year after year. Until recently, corporate target’s ambition and meaningful relative to the issuer’s social and governance metrics, such as worker safety or women original financial characteristics. However, since the market is in management, were much less common. This tendency may still relatively nascent, there has been little ex-ante variability have been partly influenced by the ECB which, for the moment in financial incentives so far. This is partially due to a lack of at least, can only purchase sustainability-linked products with transparency around target ambitions, driven by the absence environmental targets, which may deter Eurozone companies of harmonized sustainability disclosures. For SLBs, the market from using social and governance metrics. Yet demand for has typically opted for a 25 basis point step-up in the event more innovative indicators is growing as companies seek to that issuers fail to hit targets; and some issuers, particularly leverage these instruments to address various sustainability in emerging markets, have offered larger step-ups. For SLLs, priorities, with new metrics emerging around freshwater there is typically a step-down of 5 to 10 percent of the initial consumption, waste reduction, and workplace diversity. margin if the target is met, which can also be combined with a step-up if the target is missed. However, beyond pricing Water % penalties, missed targets could have broader consequences Female % for a company, as they may indicate increased operational, staff Energy % financial, and reputational risk, which in turn could raise efficiency Women in the company’s cost of capital and reduce its ability to raise management % additional financing. Waste % Corporate ESG metrics are the most popular sustainability Carbon % emissions indicator. Some 90 percent of sustainability-linked financing Electric % vehicles to date has used corporate ESG metrics for their targets. The Worker safety % remaining 10 percent were mainly third-party ESG ratings from Renewable energy % agencies such as Sustainalytics, MSCI, and Vigeo Eiris. Since corporate ESG metrics are increasingly available to the public 0 500% 1000% 1500% 2000% through annual sustainability reports, they have gradually become more popular than third-party ratings, which can be FIGURE 6 Annual Growth of Sustainability-Linked perceived as a black box, with a methodology owned by the Financing by Corporate Metric in 2021 score provider and beyond the issuer’s direct control. Source: BloombergNEF, Bloomberg L.P. 3 This publication may be reused for noncommercial purposes if the source is cited as IFC, a member of the World Bank Group. SLBs tend to have just one metric, while SLLs can have up Sustainability coordinators play an important role in to four or five.7 This distinction is largely driven by different ensuring targets are ambitious and fit for purpose. The market structures. The SLB investor pool is often large and facility’s sustainability coordinator must ensure that (a) the highly diversified, demanding pricing mechanisms that are underlying sustainability metric is material to the borrower’s simpler and easier to track. Conversely, SLLs are usually core business, e.g., a reduction in freshwater use might be syndicated by a small group of banks with deep in-house relevant to a mining company but not to a wind power expertise and sophistication, making it easier to track more producer; and (b) the proposed target is ambitious, e.g., a complex structures with multiple metrics. 60 percent reduction in carbon emissions by 2030 might not be ambitious if it uses 2010 as baseline. To determine Material sustainability metrics should be linked to ambitious this, sustainability coordinators undertake a materiality targets, as well as credible and meaningful action plans assessment of the company’s sustainability metrics and to achieve them. Contrary to other sustainable finance benchmark targets against the company’s historical instruments (i.e., green, social, and sustainable), sustainability- trajectory, typically looking back at least three years, and also linked loans and bonds generally have no constraints on the against the company’s industry peers. This analysis provides use of proceeds. In many cases, these products are used for an indication of the target’s ambitiousness, eliminates general corporate purposes, where the borrower retains full perceptions of “business-as-usual” improvements, and discretion as to the allocation of capital. This is part of the informs decisions on pricing incentives. reason that these instruments have grown so fast. However, it is important for companies to have credible action plans to Second Opinion Providers provide an additional layer of achieve their sustainability targets, including an associated credibility. Sustainability metrics and targets, as well as the budget, whenever possible. scope and methodology, are captured in a “sustainability- linked financing framework.” This document describes As a result, investors have been particularly keen to invest the rationale for prioritizing certain metrics over others, in “super green” structures, i.e., sustainability-linked the justification behind proposed targets, the action plan instruments in which companies also commit to use the that will support target achievement, and the reporting proceeds for green or social projects that will help them mechanism for selected metrics. The framework is validated achieve their targets. An example is Verbund’s €500 million by a Second Party Opinion (SPO), which will corroborate SLB issued in March 2021.8 The bond combined green that targets are science-based and ambitious, consistent with use-of-proceeds with a coupon step-up linked to corporate the borrower’s strategy, and within reasonable reach for the targets on renewable energy. These types of instruments borrower. The SPO will also confirm the alignment of these reassure investors about a company’s commitment to meet instruments with the Sustainability-Linked Loan Principles its sustainability targets, and they fit into the investor’s and Sustainability-Linked Bond Principles. portfolio green allocation commitments. Conclusion The Role of Sustainability Coordinators Sustainability-linked finance is expected to continue Targets are usually negotiated by one of the lenders under growing and evolving over the next few years. Growth the role of sustainability coordinator. The “Sustainability- will be driven by rising public awareness of climate change Linked Loan Principles”9—published by the Loan Market risks and global inequalities; soaring appetite for impact Association in March 2019 and updated in July 202110 —as investing, particularly from younger generations15; and well as the “Sustainability-Linked Bond Principles”11— enlarging public regulation on sustainable finance and published by the International Capital Markets Association ESG disclosure standards for companies, with the aim of in June 2020—aim to preserve the integrity of SLLs aligning financial flows with governments’ sustainability and SLBs by setting voluntary guidelines for market objectives and increasing transparency from the private participants. The Sustainability-Linked Loan Principles sector.16 As the sector matures, sustainability coordinators’ recommend that targets are negotiated and set between the support on impact measurement, along with additional borrower and a single lender leading the group, i.e., the client support in the design and execution of sustainability “sustainability coordinator.” For SLBs, this role is normally action plans, will become important for the success of performed by the underwriting bank. these instruments in achieving their intended objectives. 4 This publication may be reused for noncommercial purposes if the source is cited as IFC, a member of the World Bank Group. BOX 1 IFC’s Full-Cycle Offering for Sustainability-Linked Financing in Emerging Markets As the largest development institution focused on to the borrower’s business strategy; (ii) benchmarking the private sector in developing countries, IFC is well- proposed targets for each metric against the borrower’s positioned to support the scale-up of sustainability- historical performance and industry peers to ensure linked financing in emerging markets. Driven by ambitiousness; (iii) defining relevant reporting increasing private sector demand, and in support of methodologies and external verification mechanisms the 2030 Agenda of its client countries, IFC has rolled for target compliance; (iv) structuring financial out a comprehensive offering for sustainability- incentives that are commensurate with the target’s linked financing. It combines IFC’s globally recognized ambition, drafting sustainability-linked financing expertise in sustainability and impact measurement, frameworks whenever needed, and incorporating its deep understanding of local markets, its access to legal language in the documentation; and (v) assisting blended finance and financing in local currencies, in the SPO of the sustainability-linked financing and its funding for pre-investment work. IFC sees framework, if required. (See Example 1 in Annex for these instruments as an opportunity to elevate its more information.) client partnerships from the purely financial to In addition to the market-standard Sustainability long-term strategic engagements around their Coordinator role, IFC can provide strategic and sustainability agendas. implementation support to assist companies in their IFC can successfully play the role of sustainability broader sustainability objectives. Deploying a team of coordinator, leveraging internal know-how on impact in-house experts and consultants, as well as financial measurement and sustainability. IFC has led the resources on a case-by-case basis, IFC can provide two development of widely-used sustainability and impact levels of support to clients. The first service is “strategic metrics, including the HIPSO indicator set and Joint support” to assist clients in crafting or refining their Impact Indicators.12 In 2017, IFC developed an ex-ante sustainability strategy, so that it is comprehensive (e.g., impact assessment tool—the Anticipated Impact not limited solely to carbon emissions), ambitious, and Measurement and Monitoring (“AIMM”) system13— inclusive. Interventions can include net-zero pathways, which scores project outcomes (i.e., stakeholder, climate resilience roadmaps, “Just Transition” plans,14 economy-wide, and environmental effects) and community engagement plans, gender strategies, catalytic or systemic effects on markets. In addition, and others. The second service is “implementation IFC has in-house experts in sustainability and climate, support” to assist clients in implementing pre-identified which can lead the set-up of sustainability-linked sustainability initiatives or new technologies that will finance frameworks and coordinate SPOs. help them implement their sustainability strategies. This might include pre-feasibility studies to assess the Sustainability coordinator activities are embedded in commercial or technical viability of new decarbonization IFC’s mandate for sustainability-linked financing. At no technologies (e.g., hydrogen, batteries, floating solar additional cost to clients, IFC assigns a sustainability PV) for client operations, support in the implementation coordinator to each transaction, composed of in- of community engagement or gender programs, and house experts from its climate business department others. IFC can partially co-fund some of these activities and its advisory teams. Activities covered by the or projects via its own funds or donor financing. sustainability coordinator can vary depending on the project, but they generally include: (i) identifying See Annex for more information on IFC’s experience in corporate- or project-level metrics that are material sustainability-linked finance. ACKNOWLEDGEMENTS The authors would like to thank the following colleagues for their review and suggestions: Bertrand de la Borde, Director, Energy & Mining, Global Infrastructure, IFC; Francisco Avendano, Senior Operations Officer, Climate Policy Team, Climate Business, IFC; Don Purka, Principal Investment Officer, Upstream – Global Infrastructure, IFC; Berit Lindholdt-Lauridsen, Senior Operations Officer, Climate Finance, Climate Business, IFC; and within Thought Leadership, Economics and Private Sector Development, IFC: Imtiaz Ul Haq, Economist; Wen Kang Chow, Research Assistant; and Thomas Rehermann, Senior Economist. 5 This publication may be reused for noncommercial purposes if the source is cited as IFC, a member of the World Bank Group. Annex Example 1 IFC as Sustainability Coordinator IFC has experience acting as Sustainability Coordinator in emerging markets, both for SLLs and SLBs. In 2021 to date, IFC has committed close to $700 million in long-term finance in various sustainability-linked transactions across the globe. This includes (i) a $30 million super-green SLL to Turkish municipal water utility IZSU linked to gender equality;17 (ii) a $56 million super-green SLL to Brazil’s state-own water utility Corsan linked to reduced water distribution losses, which also benefited from additional co-funded advisory services;18 (iii) an $85 million SLL to Thai cargo carrier Precious Shipping linked to reduced freshwater use;19 and (v) a $500 million SLB to Pan-Asian energy provider Sembcorp Industries linked to GHG emissions reduction targets.20 Example 2 IFC Strategic / Implementation Support IFC also has vast experience helping companies with their sustainability strategies. Relevant examples of this work include: (i) Nachtigal Hydro Power Company (Cameroon), where IFC provided $13 million in InfraVenture funds for project co-development, as well as advisory to improve local sourcing, community engagement, gender equality, and livelihood restitution; (ii) Medellin’s smart city strategy (Colombia), where IFC Advisory helped develop an action plan to integrate the use of digital solutions and big data in the city; and (iii) Oyu Tolgoi (Mongolia), where IFC Advisory trained over 1,500 stakeholders on mining and groundwater management. Example 3 IFC in a SLB: Sembcorp (Singapore) This landmark deal was the first SLB by an energy company in Southeast Asia, and the region’s largest such issue to date. The investment comprised S$675 million ($500 million equivalent) that will be used for renewable energy projects and other sustainable assets. The bond included a 25-basis-point step-up linked to a corporate carbon intensity reduction target of 25 percent by 2025. This SLB issuance was completed at a crucial stage of Sembcorp’s strategic shift to transform itself into a leading sustainable solutions provider in Asia, in line with the company’s roadmap to quadruple renewable generation capacity to 10 GW by 2025. In addition to anchoring the issue, IFC helped Sembcorp review the sustainability-linked finance framework, including a materiality assessment for the selection of metrics, target benchmarking, implementation action plans, and reporting methodologies. Example 4 IFC in a Super-Green SLL: Corsan (Brazil) The investment consisted of a R$300 million ($60 million equivalent) green and sustainability-linked loan to support Corsan’s water-loss program and energy efficiency improvements through network replacement and efficient electric pumps and hydrometers. The facility included a coupon step-down linked to Corsan’s target of reducing water losses in distribution to less than 35 percent by 2024. In addition to the standard Sustainability Coordinator services provided by IFC, this project benefited from additional advisory and funding support through the “Utilities for Climate” initiative.21 This work is helping Corsan diagnose and plan priority locations and interventions for its objective to reduce water losses. 6 This publication may be reused for noncommercial purposes if the source is cited as IFC, a member of the World Bank Group. 1 Enel. 2019. “Enel Launches the World’s First ‘General Purpose SDG-Linked Bond’, Successfully Placing a 1.5 Billion U.S. Dollar Bond on the U.S. market.” https://www.enel.com/content/dam/enel-common/press/en/2019-September/SDG%20bond%20ENG%20(003).pdf. 2 European Central Bank. 2020. “ECB to Accept Sustainability-Linked Bonds as Collateral.” https://www.ecb.europa.eu/press/pr/date/2020/html/ ecb.pr200922~482e4a5a90.en.html. 3 Sources: (i) Margolis, Joshua D., Hillary Anger Elfenbein, and James P. Walsh. 2009. “Does it Pay to be Good…And Does it Matter? A Meta-Analysis of the Relationship between Corporate Social and Financial Performance.” Available at SSRN: https://ssrn.com/abstract=1866371; (ii) Flammer, Caroline. 2015. “Does Corporate Social Responsibility Lead to Superior Financial Performance? A Regression Discontinuity Approach.” Management Science 61(11), pp. 2549-2568; (iii) Eccles, Robert G., Ioannis Ioannou, and George Serafeim. 2014. “The Impact of Corporate Sustainability on Organizational Processes and Performance.” Management Science 60(11), pp. 2835-2857; (iv) HEC Paris (2020). “Does CSR Actually Pay Off?”. https://www.hec.edu/en/faculty-research/centers/society-organizations-institute/think/so-institute-executive-factsheets/does-csr-actually-pay. 4 The 2030 Agenda for Sustainable Development, approved in September 2015 by the United Nations General Assembly, establishes a transformative vision toward the economic, social and environmental sustainability of the 193 member states that adopted it. The 17 Sustainable Development Goals are a key part of this Agenda. For more information, visit https://sdgs.un.org/2030agenda. 5 Analysis based on Country of Domicile, according to Bloomberg data. 6 Analysis based on WB country classification. https://datahelpdesk.worldbank.org/knowledgebase/articles/906519-world-bank-country-and- lending-groups. 7 S&P Global Ratings. 2021. “How Sustainability-Linked Debt Has Become a New Asset Class.” 8 Verbund. 2021. “Verbund - Innovative EU Taxonomy Aligned “Green and Sustainability-Linked Bond” Was Successfully Placed.” https://www.verbund. com/en-at/about-verbund/news-press/press-releases/2021/03/25/sustainability-bond-post-pricing. 9 Loan Market Association, Asia Pacific Loan Market Association, Loan Syndications & Trading Association. 2019. “Sustainability Linked Loan Principles.” https://www.icmagroup.org/assets/documents/Regulatory/Green-Bonds/LMASustainabilityLinkedLoanPrinciples-270919.pdf. 10 Loan Market Association, Asia Pacific Loan Market Association, Loan Syndications & Trading Association. 2021. “Sustainability Linked Loan Principles.” https://www.lsta.org/content/sustainability-linked-loan-principles-sllp/. 11 ICMA. 2020. “Sustainability-Linked Bond Principles.” https://www.icmagroup.org/assets/documents/Regulatory/Green-Bonds/June-2020/ Sustainability-Linked-Bond-Principles-June-2020-171120.pdf. 12 Harmonized Indicators For Private Sector Operations (HIPSO). 2021. IFC. https://indicators.ifipartnership.org/. 13 IFC. (n.d.) “Anticipated Impact Measurement and Monitoring.” https://www.ifc.org/wps/wcm/connect/topics_ext_content/ifc_external_corporate_ site/development+impact/aimm. 14 “Just Transition” plans encompass a range of social interventions needed to secure workers’ rights and livelihoods when companies shift to sustainable business models. 15 Morgan Stanley Institute for Sustainable Investing. 2017. “Sustainable Signals: New Data from the Individual Investor.” https://www.morganstanley. com/pub/content/dam/msdotcom/ideas/sustainable-signals/pdf/Sustainable_Signals_Whitepaper.pdf. 16 European Commission. (n.d.). “Sustainable Finance.” https://ec.europa.eu/info/business-economy-euro/banking-and-finance/sustainable- finance_en. 17 IFC. 2021. “IFC Helps Improve Water Supplies, Wastewater Services for over 400,000 People in Izmir, Turkey.” https://pressroom.ifc.org/all/pages/ PressDetail.aspx?ID=26440. 18 Companhia Riograndense de Saneamento. 2021. “Corsan Announces Initiatives for Energy Efficiency Improvements and Water Loss Reduction.” https://api.mziq.com/mzfilemanager/v2/d/ffc599e5-be3d-4e19-8c9d-39fa06fe7391/77b7d20f-8c54-2450-3850-731220266a23?origin=1. 19 IFC. 2021. “IFC’s Sustainability-Linked Financing to Boost Resilience of the Shipping Sector, Sustain Regional Trade Flow Amid COVID-19.” https:// pressroom.ifc.org/all/pages/PressDetail.aspx?ID=26465. 20 Sembcorp. 2021. “IFC Marks First-Ever Investment in A Sustainability- Linked Bond Globally with S$675 Million Offering By Pan-Asian Energy and Sustainable Solutions Provider Sembcorp Industries.” https://pressroom.ifc.org/all/pages/PressDetail.aspx?ID=26652. 21 IFC. 2021. https://www.ifc.org/wps/wcm/connect/industry_ext_content/ifc_external_corporate_site/infrastructure/priorities/water/water_ u4c?CID=IFC_LI_IFC_EN_EXT. 7 This publication may be reused for noncommercial purposes if the source is cited as IFC, a member of the World Bank Group. IFC 2121 Pennsylvania Avenue, N.W. Washington, D.C. 20433 U.S.A. ifc.org/ThoughtLeadership JAN 2022