International Finance Corporations' Environmental and Social Performance Standards and Select United States Laws and Regulations

The Capstone team worked with the American Petroleum Institute (API) and the Association of Oil Pipe Lines (AOPL), analyzing the intersection of domestic and international pipeline environmental and social (E&S) standards in order to highlight opportunities to further secure pipeline operators’ social license to operate (SLO).[1] The team was tasked with benchmarking a subset of U.S. regulations with International Finance Corporation’s Environmental and Social Performance Standards (IFC PS), identifying and analyzing gaps between a select portion of the two frameworks, and providing recommendations based on recognized limitations of the study.  The Team worked with API, AOPL, the faculty advisor and experts from Citigroup and Wells Fargo to set the scope of the project.

The Capstone team composed a Gap Analysis Table and written Recommendations based on the comparison between IFC PS 1 (Assessment and Management of E&S Risks and Impacts) PS 4 (Community Health, Safety, and Security), and PS 5 (Land Acquisition and Involuntary Resettlement) and select U.S. federal and state laws, understanding that some of these Recommendations may reinforce existing best practices not reviewed as part of the study.  Together, the Gap Analysis Table and Recommendations provide a roadmap for addressing E&S risk management (ESRM) as treated by the IFC PS and as they relate to the select U.S. crude oil pipeline requirements.  The potential gaps illustrate the varied overlay of international standards onto a subset of the U.S. system, while the Recommendations address these gaps.  When combined, these documents give pipeline operators a snapshot by which to consider additional practices to ESRM in the U.S. crude oil pipeline industry in a way that supports pipeline operators’ existing programs and practices in furthering their SLO.

[1] Any reference made herein to "client" is strictly in the context of the organization's participation in the Capstone project, and shall not create any other relationship between the organization(s) with SIPA, Columbia University or the Capstone team.