2012 ADB Results-Based Financing Review
In June 2012, the Asian Development Bank (ADB) proposed results-based financing (RBF) for programs to directly link disbursements to achievements of results in government-owned programs. The new RBF proposal’s stated goals included increasing accountability of outcomes and incentives to deliver results, improving the effectiveness and efficiency of government-owned programs, and facilitating development coordination and harmonization.
After issuing its RBF proposal, the ADB sought comments and suggestions from stakeholders and from the public. In July 2012, Accountability Counsel submitted comments with suggestions to improve the RBF proposal.
Accountability Counsel’s Impact on the 2012 Review
In August 2012 the ADB published a working paper with revisions to its RBF proposal, including several based on Accountability Counsel’s recommendations.
- Exclusion of risky projects: The ADB addressed Accountability Counsel’s recommendation to not support any program where non-compliance is a concern. By excluding riskier Category A projects, the ADB minimizes the possibility of non-compliance with its Safeguard Policy Statement.
- Full application of accountability mechanisms: Accountability Counsel urged that the Safeguard Policy Statement and accountability mechanism policies should apply to the entire RBF program, not merely the part of the project that is financed by the ADB. Though little change occurred in the proposal itself, the recommendation received a positive response in the ADB’s review of external comments on the proposal.
- Transparency and consultation: The revised proposal clarified that RBF programs must comply with the public communications policy, which follows Accountability Counsel’s recommendation for greater transparency and disclosure in RBF projects.
Despite these important changes, Accountability Counsel will continue advocating for a stronger and more transparent RBF programs. Further recommendations would urge that the ADB, at a minimum, pledge not to support any project where non-compliance with the Safeguard Policy Statement is a concern, directly monitor Safeguard Policy Statement implementation, and ensure greater transparency and disclosure throughout all RBF programs and subprograms. We believe these changes are necessary to fully protect rights under the RBF modality.