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About Adoption & Membership

Adoption of the Equator Principles (EP) is open to any financial institution that meets the relevant adoption requirements and agrees to meet the ongoing requirements, as set out in the EP and the Governance Rules.

Financial institutions must apply to become a member of the EP Association – the process is outlined below. Adoption by a financial institution is voluntary but once such adoption has been made, the adopting entity must take all appropriate steps to implement and comply with the EP.

Financial institutions are strongly encouraged to adopt the EP through their group holding company. Where this is not possible, they should seek to adopt at the highest possible level to enable a broad and consistent commitment to the EP across their relevant business functions and operating subsidiaries.

The Adoption Process

The adoption process is outlined below:

Step 1

Before embarking on the adoption process the adopting institution should read and understand:

Step 2

For further information about adoption and implementation of the EP, refer to the ‘Frequently Asked Questions’ (see below).

Step 3

Contact the EP Association Secretariat (at secretariat@equator-principles.com), who will ask some initial questions to determine the institution’s suitability to adopt the EP and answer any queries the institution may have.

Step 4

The EP Association Secretariat will provide the prospective EP Financial Institution (EPFI) with the required adoption paperwork for completion.

Step 5

It is then determined whether the adoption requirements have been met and the application is forwarded to the EP Association Steering Committee Chair for approval. The prospective EPFI should note that:

  • the decision cannot always be made immediately;
  • there can be a several-months long process of review to ensure the eligibility criteria are met, including appropriate level of adoption.
Step 6

If adoption is approved, an adoption date will then be agreed between the EP Association Secretariat and the prospective EPFI.

Frequently Asked Questions

Who can adopt the Equator Principles?

Adoption of the Equator Principles (EP) is determined by whether the financial institution is “Active in Project Finance, Project Finance Advisory Services, Project-Related Corporate Loans, Bridge Loans, Project-Related Refinance and/or Project-related Acquisition Finance”.

Evidence, such as from international league tables, to demonstrate that the prospective adopter undertakes Projects that would deem it ‘Active’ may be required as part of the process.

What does membership of the EP Association involve?

All members of the EP Association (known as Equator Principles Financial Institutions or EPFIs) are required to comply with the EP Association Governance Rules and to meet the requirements set out in the current EP.

More generally, the EP Association is a membership organization, governed by a Steering Committee of elected volunteers whose work is largely undertaken by a number of voluntary EPFI-led Working Groups. All EP Association members benefit from the work of the Steering Committee and the Working Groups, and as such, EPFIs are expected to play an active role in participating, and supporting the work of these groups. Tasks might include engaging in Working Group calls, contributing to and reviewing guidance documents, and inputting into reviews by third party consultants undertaken on behalf of the EP Association.

Members of the EP Association have access to a wide collaborative network of peers to share knowledge and contribute towards best practice development. Members are strongly encouraged to participate in the Annual General Meeting, which offers a great opportunity to network with other EPFIs, as well as to learn more about the EP Association.

My financial institution is interested in adopting the Equator Principles, what is the first step?

As a first step we encourage prospective adopters to thoroughly review the Equator Principles (EP) website to ensure that they understand the EP and the Association itself.

We strongly encourage any prospective adopters to read in detail:

  • The most recent version of the EP and the EP Association Governance Rules, before deciding if they wish to proceed with a query.
  • The Resources page, which contains key EP documents including important information on EP implementation.
  • The Adoption Process section (above), which contains key details on the application process.

Once all these materials have been reviewed and a prospective adopter is keen to continue or has further questions, they should then contact the EP Association Secretariat at secretariat@equator-principles.com about application details and/or any adoption-related questions.

Some financial institutions may choose to consult with an existing EP Financial Institution in the same region for adoption information and experience.

Note that all adoption queries remain confidential until the adoption date.

What are the factors considered by the EP Association when reviewing an application?

Adoption of the Equator Principles (EP) is open to financial institutions who undertake transactions within the scope of the EP (i.e. the financial institution has a level of activity in Project Finance as per the EP definition). Evidence of this via league tables or project examples can be helpful. For more information see Scope of the EP.

Financial institutions are strongly encouraged to adopt the EP through their group holding company. Where this is not possible, they should seek to adopt at the highest possible level to enable a broad and consistent commitment to the EP across their relevant business functions and operating subsidiaries.

How long does the adoption process take?

The main factor is the readiness of the prospective adopter. However, timing can vary due to several factors, including for example:

1) whether the prospective adopter provides the required information and documentation in a timely manner;

2) whether additional information is required;

3) the availability of key individuals within the EP Association to review the material, and

4) the number of applications in the pipeline (they are reviewed on a first-come first-served basis).

If there is a particular date by which a prospective adopter wishes to adopt, then they will need to notify the EP Association Secretariat early in the process and also ensure that all of the required documentation, and supplementary material, is available. The EP Association Secretariat cannot guarantee that a specific timeframe can be met, especially if it is less than one month.

Are we required to use a third party (e.g. a consultant or legal firm) to assist with the adoption process?

No. The adoption process is very straightforward and the EP Association Secretariat can assist with any queries that you may have. You might also wish to speak directly with an existing EP Financial Institution (EPFI) in your region.

Many financial institutions do use third parties to assist with updating their environmental and social policies to ensure that they comply with the Equator Principles, as required. The EP Association Secretariat cannot make recommendations with regard to any third parties.

Does my institution need to have specific policies and procedures in place to adopt the Equator Principles?

Adoption of the Equator Principles (EP) by a financial institution is voluntary but once such adoption has been made, the adopting entity (or Equator Principles Financial Institution, EPFI) must take all appropriate steps to implement and comply with the EP. Each EPFI shall introduce and implement its own internal environmental and social risk management policies, procedures, and standards in order to comply with the EP.

There is a range of key documents and resources about EP implementation on the Resources page.