The environmental and social action plan (ESAP) is the document that turns due diligence findings into commitments. It is attached to the loan agreement, and compliance with it is verified throughout the life of the loan.
What an ESAP is and why it matters
An ESAP lists the actions the project must carry out to align with the IFC Performance Standards and the Equator Principles, each with its deliverable, owner and date. Some are conditions precedent to financial close or to a disbursement; others are completed during construction or operation.
Because it is a contractual obligation, a poorly drafted ESAP is expensive. Ambiguous actions lead to disputes with lenders, and unrealistic deadlines mean asking for extensions from the first quarter.
What makes an ESAP work
- Specific actions. "Develop and implement a grievance mechanism for contractor workers" can be verified; "comply with PS2" cannot.
- One verifiable deliverable per action. An approved plan, an amended contract, a monitoring report.
- Dates tied to project milestones. Financial close, first disbursement, start of works, commercial operation.
- A defined owner. With a job title, and with resources allocated in the budget.
- Proportionality. Actions respond to the project's actual risks, not to a template.
How we help
Drafting the ESAP
As the outcome of an environmental and social due diligence, we draft the action plan and agree it with the project and the lenders.
Review and negotiation
If another consultant prepared the draft, we review it on the developer's side: we check that each action is executable, that deadlines are realistic and that the scope is proportionate.
Implementation
We develop the plans and studies the ESAP requires: environmental and social management system, stakeholder engagement plan, livelihood restoration plans and biodiversity action plan, among others.
Tracking and close-out
We track progress, organize the evidence and prepare compliance reports for the lenders until each action is closed. See lender monitoring.
Typical ESAP actions
- Strengthening the environmental and social management system and contractor management.
- Stakeholder engagement plan and grievance mechanism.
- Labor procedures and worker accommodation standards.
- Livelihood restoration plan.
- Critical habitat assessment and biodiversity action plan.
- Security management plan.
- Chance find procedure.
- Emergency preparedness and response plan.
The best time to shape an ESAP is before it is signed. Once it is attached to the loan agreement, changing an action or a deadline needs the lenders' approval.