Decent work and development finance
Background paper for Decent Work and Labour Standards Forum
March 2010
This paper aims to:
- Explain the workings of development finance to the private sector, and examine its actual and potential impacts on delivering decent work in a variety of contexts.
- Increase understanding of the relevance of the Decent Work Agenda for the provision of development finance to private sector companies in developing countries.
In relation to decent work and labour standards, the paper reviews the policy and practice of development finance institutions (DFIs) such as the European Bank of Reconstruction and Development; the International Finance Corporation at the World Bank; and the UK’s CDC Group plc, which in which DFID has a 100% stake.
The paper concludes that DFIS are important actors in the Decent Work Agenda, as their investments create and sustain significant numbers of jobs. But the structure of much development finance means that there is not always a prioritisation of decent work factors – such as the sorts of jobs created. To date, much DFI work on ‘labour issues’ has taken the form of mitigating risks to a project which is already fully or mostly formed.
Therefore, one recommendation of the study is that DFIs could more fruitfully give greater and earlier attention to decent work factors to improve development outcomes and facilitate compliance with labour standards requirements. The paper also outlines opportunities for Forum members to engage with development finance.
Decent work and development finance
