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2.3.2. Main entry points in greening blended finance

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✅ Engage in a green dialogue with the financial institutions. The dialogue with financial institutions held by DGs INTPA, ENEST and NEARMENA, and EU Delegations must convey the importance that the Commission places on maximising opportunities to contribute to the green transition and ensuring compliance with the DNH and ‘green and clean’ principles. This dialogue can touch on any issues of concern, such as prioritisation of investments based on green criteria, the use of robust environmental safeguards/standards, and ensuring adequate environmental and climate risk monitoring and reporting provisions.

✅ Understand the applicable environmental standards and safeguards of the Lead Financial Institution (LFI). In the case of environment and climate risk screening and assessment, verify that the requirements are aligned to those under the EU EIA Directive^[28]. If not aligned, the application of stricter standards can be requested from the LFI. If intermediary financial institutions will be involved, enquire about the standards and safeguards that will be applied and how the LFI is ensuring their quality, possibly by supporting the intermediary institutions to build their capacities and upgrade their standards.

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If considered necessary, request the full assessment reports for their review, which should be shared by the LFI as early as possible. It is pertinent to recall that EIA-related documents (especially the EIA report) must be publicly available. In case of doubts, check the quality of these documents; INTPA, ENEST and NEAR thematic MENA  thematic units in HQ can provide support.

If the EIA has not yet been prepared, and if the EIA ToR are open for comments, think of promoting ambition beyond the minimum requirements, for example asking for the potential for nature-based solutions to be explored as part of the project’s design. Other relevant document that should be shared (if available) include biodiversity management plans and Environmental Management Plans to avoid, minimise, restore or offset negative impacts.

The INTPA-NEAR ENEST-MENA tool for the screening of investment project pipelines (Annex 13) can be used to get an initial appreciation of the potential environmental and climate-related risks.

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Considerations related to contracting, monitoring and evaluations, including due diligence provisions, are common to both blended finance and budgetary guarantees, and are described in section 2.3.4.

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